If you want (even more) proof that markets are irrational short term, the #bitcoin #hardfork price jump should do it.
#EMH #cryptocurrencyhttps://twitter.com/bramcohen/status/917828859822772225 …
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As formulated by Fama in '65, the hypothesis is stronger; it says that prices reflect (noisy) intrinsic value. http://www.jstor.org/stable/2350752 pic.twitter.com/QBwOMdXknU
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But the empirical tests can't confirm that, and reinterpretations sometimes say it's only unpredictable - because that's a verifiable claim.
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But Fama stands by the initial claim that prices provide accurate signals of value. See intro here; http://www.e-m-h.org/Fama70.pdf
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I don't get it. If <Price-Value>=0, P is an unbiased estimator of V. Can hope to further lower variance (difficult) but bias is 0 already.
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On the other hand, EMH is a rule to define the number V (set it so <>=0), which can't be measured separately, so no surprise P is "accurate"
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It's possible that there are unpredictable terms, say sentiment, S, and ratio, R, so that P+S-V*R = 0. Price isn't predicting value alone.
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In that case, as long as market sentiment and the ratio vary unpredictable, we'd still see results of EMH, not needing the strong assumption
End of conversation
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