Jan

6

In considering the ecology of markets it is always helpful to see what's moving in conjunction with other things. Here's a interesting 2 by 2 table (a template of which Galton and all his followers should always keep in their wallet for updating with pin pricks).

It is a shocking table that shows that increases and decreases in wealth, what I used to call healthy and unhealthy days respectively, in both big markets in conjunction are half as likely as counter moves in the two, when US wealth is relatively little changed.

Steve Ellison writes in:

Not surprisingly, it seems the net result was a decrease in wealth. In a talk in Singapore yesterday, Brad DeLong estimated that global financial assets have shrunk from $80 trillion to $60 trillion in the past 18 months.


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2 Comments so far

  1. legacy daily on January 3, 2009 9:42 am

    Would you kindly define what was considered “Big Rise” and “Big Decline” in this case?

  2. vic on January 3, 2009 6:19 pm

    The criterion was above 1 point in bonds and 10 full points in S&P [based on daily closing futures prices]. Of course the real question is the subsequency. v

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