Bob Murphy, Infallible Stock Prognosticator

I did not have sufficient faith: Bob's call of market disaster almost precisely indicated a market bottom. (Look at the one year chart, and you can see that within a couple of days of when Bob gave his warning to get out, the S&P 500 began going almost straight up.)

This is classic reverse psychology, folks, and Bob is making his readers money: he knows they are all contrarians, and will do the opposite of what he tells them to do.

20 comments:

  1. 'If the Dow gets back down to 15,000 it is buy time again.'

    Can we assume that Bob is not the only using reverse psychology ?

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    1. Huh? Not sure what you mean. I actually bought back in the market a couple of weeks ago. I SHOULD have bought back in as soon as I saw Bob's call, however!

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    2. If someone had followed your advice and waited for the Dow to bottom at 15000 before buying then they would have missed the recent increase, just as much as if they followed the more dire implications of Bob's post.

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    3. Rob, you apparently don't understand the difference between advising people to sell, and advising them to buy (or buy more). Someone who was holding stocks, and followed by advice, would have participated in the run-up, just not as much as if they had bought more.

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    4. Not sure how you would conclude that, since my comment is clearly about buying not selling.

      My real point was just to highlight that it is bit rich to satirize Bob for bad stock advice when your own advice would have caused people to miss a double digit run-up.

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    5. As I said, rob, it is apparent you have no idea what you are talking about. And now apparent you don't want to figure it out.

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    6. It may be annoying to you, and even a bit petty in the general scheme of things , for me to point that saying 'If the Dow gets back down to 15,000 it is buy time again.' is bad advice in a scenario where the Dow actually bottomed at 15500.

      But I don't think it a reasonable response for you to say 'it is apparent you have no idea what you are talking about'!

      Anyway, I was initially only trying to join in the fun that you were having with Bob - but oh , well.

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    7. rob, you just keep missing the difference between "time to buy" and "hold what you've got" and "time to sell." This is standard issue financial stuff, and you don't seem to understand it.

      And, in any case, *I* was not publishing stock market advice: I was challenging Bob to a bet. And what's more, *in this very post*, I said I should have trusted my buy signal more: if Murphy is saying "sell," it's time to buy. I gave him a 1000-point leeway I shouldn't have.

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    8. What you actually said was "If the Dow gets back down to 15,000 it is buy time again. Do you want to write a derivative contract on whatever position I take so you can short my position?".

      Based on this view you could have maximized your profits by purchasing options to buy into the dow when it hit 15000.

      Now obviously you were on pretty safe ground in terms of Bob wanting to sell you such options , but someone else who had correctly called the recent market bottom could have made money by shorting your position.

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    9. BTW: I get that your mainstream view is more likely correct in the case of this particular market correction, I was initially just making a joke that you had yourself not read the market perfectly, and would have left it at that if you hadn't responded with insulting comments on my comprehension abilities.

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    10. "and would have left it at that if you hadn't responded with insulting comments on my comprehension abilities."

      Well, rob, you DO misunderstand the difference between buy calls, hold calls, and sell calls. When I first pointed that out, it was merely to note that you've missed this point. I became a little more strident when you just blew right past this point as though I hadn't spoken, sure, but that's the price you pay for not paying attention!

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    11. As I've noted before, rob, here is your typical interaction at this site:

      rob: X!

      Gene: Well, ok, but you've neglected Y and Z.

      rob: X!

      Gene: rob, did you even read my previous comment?

      rob: X!

      Gene: OK, rob, you're acting like a nitwit, now go away.

      rob: Gene is insulting, and censors me!

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  2. Let me just make sure I know the ground rules here. Suppose 5 years from now, the market is 20% lower than when I posted that. Am I able to link to this current post Gene and demand an apology, or at least as admission that you're being a pain in the a$$?

    Or will you say, "No Bob, you should've at the time posted a chart showing the ups and downs in the stock market back in 2000/1 and 2007/8, so that people would've realized there were wild ups-and-downs amid the general crash."

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    1. My impression was the ground rules are this: every time the market pulls back five or 10%, The Austro-distrasists get to say "See! We told you it was all going to collapse!" Then when it goes back up and makes the new high… Shhh!

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  3. "The new high"? You mean new since September?

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  4. Excuse me, I was too generous. I should've said:

    "New high"? You mean new since early January?

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    1. I was describing the general Austro-disastron pattern. I did not claim there was a new high recently.

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    2. Right, and by the same token, I wasn't talking about your claims in this thread. Why would you think I was talking about a claim you had made? Clearly our arguments here have nothing to do with what the other guy actually said.

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    3. Be kind Gene. You made a hypothetical. Conditionals are hard.

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    4. Bob, I realize I've got your goat here. It's all in fun! But really, when I describe a *general* pattern of Austro-disastron stock market commentary, it just won't do to complain that in this *particular* situation, every detail is not exactly like that general pattern.

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