The piranhas are biting each other

[ThomasSoerensen]

Hedge Funds Scramble to Unload Greek Debt - NYTimes.com

select quote

Now, the smart money isn’t looking so smart. Starting in December, the counterintuitive, go-long Greece bet was one of the more popular pitches made to hedge funds in New York and London. Investment banks — Merrill Lynch was particularly aggressive in recommending the trade, investors say — argued that even though Greece was nearly bankrupt, those who bought the paper maturing in March could double their money when Greece received the next installment of its bailout, due that same month.


It seems they believe their owb BS advice - amazing that such people are allowed to take care of other peoples savings.

[xoggoth]

Indeed. I don't think financial experts have a clue. Recall getting some European stock a long while back as an article in the Sunday Times said it was a great investment and it flatlined for a decade until we sold it. Same with pharmaceuticals, guaranteed growth due to ageing world population etc. Even bigger disaster.

I bet if you took all the recommendations of financial experts over the longer term and checked them against reality you would find hardly more success than you would get by chance. Probably best option is to pile into every short term bubble going and then quit after 2 years. They usually last that long.

[eek]

I bet if you took all the recommendations of financial experts over the longer term and checked them against reality you would find hardly more success than you would get by chance. Probably best option is to pile into every short term bubble going and then quit after 2 years. They usually last that long.

You know that statement previous returns do not reflect future returns. Yes, thats because the market has already reflected future returns in the price the day before the recommendation was made.

Assuming the market reflects all known information (it probably doesn't but what the heck) by the time a stock or industry is recommended the market will have already priced in and taken the profit from the reason for the recommendation.