Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

Scott Reamer's Main Points



Scott Reamer
Slaying Wall Street's Sacred Cows
Toward a new model for understanding asset price fluctuations

  • No currently successful model for understanding what governs asset prices
    • Efficient market hypothesis, random walk, fundamental analysis, utilitarian economics, and other theories do not govern prices
      • 85% of active portfolio managers have failed to beat the major averages over the last 30 years (Ibbotson)
  • While objective reasoning may determine everyday, individual supply/demand decisions, it does not govern decisions about financial assets
    • As stock prices increase, demand increases, herding impulse, impulse decision making
  • Wall Street's favorite aphorisms are all wrong
    • Stocks reflect earnings growth
    • Gold is a hedge against inflation
    • Surprise news causes changes in stock trends
    • Commodities reflect economic growth
    • Increases in oil hurt stocks
    • Rising interest rates hurt stocks
    • The Fed sets interest rates
    • Stocks reflect macroeconomic trends like GDP
  • To answer the questions of what forces govern asset prices, how they operate, who controls them, and are they patterned, we introduce the self-organizing complex system model for asset markets
    • No centralized control, multiple autonomous agents
    • Instinct driven, governed by phi
    • Non-random: self-similarly patterned in price and time
    • "Swarm Intelligence," similar to bees, ants, or fish
    • Individual ignorance but collective intelligence
    • Communication and cooperation
    • Adaptation and feedback
  • Some technical analysis tools to recognize these patterns
    • Elliott Wave
      • "Applied Fibonacci" in 13 relatively simple patterns
      • Based on phi in price and time
      • Good in intermediate/short term
    • DeMark Indicators
      • Derived from historical price record
      • Phi based in price and time
      • Good in longer term
  • A combination of Elliott Wave, Demark Indicators, and Classic TA tools allows the strengths of one to address the weaknesses of the other

No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

Featured Videos