Chapter VII of the smoke and mirrors

 Chapter VII of the smoke and mirrors
 50 early, when George. Soros was a student studying in London in time. His approach to running the world has a strong interest. His ambition is not only to ponder on the important issues of life, but also want to know make a significant contribution to the world.
his instructor Karl. Pope, encouraged him to ponder some big problem, proposed a grand way to learn Xi. This approach may not only benefit the whole of mankind, may also make such a will benefit of persons of the way. Soros eels eels faith his best friend began Pak Wing. Wen's words: do a better job. point is he on the general theory of life and society. His thought has one of the words:
feel.
many human had the same question: What is the meaning of life? Why am I here? things one hundred and eleven large objects, such as cosmos, the brain, how the movement of one human one by one?
think carefully about these issues, people returned to their own lives, back to more practical issues, such as the burden of the family, to make a living, remember garbage, etc..
However, these problems philosophers as their life-long research project. George. Soros wanted to be a philosopher.
Although Soros is no philosophical interest event fires, but he has long time to maintain that enthusiasm. strong passion. and I understand my own need to be understood as a central issue The.
reason is simple, even if we are or who began to study what we are, we must also look at ourselves objectively.
difficulty is that we can not.
This is the great discovery Soros: < br> stone into gold In the early '50s, Soros concluded: the formation of things.
Section wild notion
to the overall concept of how to run the world as a weapon, Soros concerned about the Wall Street area is ripe.
All world views are flawed or he twisted. too disturbing, let alone in the market operation, want to do, give people most of the risk of mental stress.
agree with this rational thinking person argue that because investors can fully understand a company, Therefore, the value of each share can have an accurate price. to this understanding as a weapon, every investor will have to act rationally automatically, when a large number of shares of species appears, you can choose the best . Moreover, the stock price can also estimate the company to maintain a reasonable profit while.
efficient market hypothesis, which is also related to the stock market run of the most popular theory. This assumes a perfect, rational world, but also assume that all stocks are available to reflect the dividend.
However, when the balance of the classical economists in teaching the concept of perfect competition and the assumptions made in the perfect understanding, Soros believes himself to be more thorough understanding. In his view, In the real world, from the assumption that a perfect understanding of any theory can be obtained, are flawed. In the real world, to buy or sell decision based on the ideal of the classical economists mm mm not but people's expectations. and, In the real world, people are not understanding anything completely.
economists to balance the theory that the supply and demand are balanced. But if you realize that do not fully understand the important role to play, you will realize that you deal with the problem of the uneven application of the theory.
Also, on another occasion, he wrote that he was , George. Soros similar gambling monopoly capital, then on, he fully into the financial world. However, he also sometimes in the realm of knowledge, free, and practice, forcing him to study economics at the London School of Economics.
, however, to his disappointment, he found that the door seems very shallow knowledge.
professors want to make him believe that economics is at least trying to be mm mm or a science. You can make the theory and the laws that rule the economic world.
However, George. Soros see through all this. He concluded that if economics is a science, then it should be objective. In other words, people can not Tong affect the scope of its activities observe it. However, Soros concluded that this is not possible.
When a human being after all, is the center of all economic activities mm when the lack of objectivity, how economists may think it is the objectivity it? When these same people, from the character point of view is included in the economic life, can not fail to affect the economic life of the time, economists, how can the objectivity that they do?
Section killer < br> that assumes the economic life of the people of reason and logic argue that financial markets are always right, of the significance of the market tends to discount the price to mm mm or consider the future development, even if it is not clear.
Soros said that this is not true.
he had explained that most investors believe that they can be charged interest on the market in the future, that is, things happen in the future before taking into account the development. In the Soros view, this is not possible. He said, , I detailed description of the feedback theory, the argument is the belief that to be done to change the facts. the process. rational point of view, but rather biased point of view.
Moreover, this bias will affect their development process things. This will give people the impression that the market accurately in the future development. But, in fact, the market provides a thing is not responsible for the future current expectations, are generated by the current expectations of future things. participants feeling is intrinsically flawed, and flawed nature of the feelings and events that exists between the actual process of bilateral ties in both these bilateral links is the lack of correspondence between. I call this two-way link called l feedback r rise into the fall. not the efficient market hypothesis, but in the investors see the incident and the fact that he called a rebound relationship between the two processes. the real process of the event's economic base is another motto.
Soros that investors who see a particular stock, whether positive or negative, will cause stock prices rise or fall. This bias in the operation as a the basis of sexual orientation br> So, a stock's price is not keen on the information obtained to respond to the decision. but the feelings and the hardware as much as the feelings generated results. As George Soros in the : the facts. two key is to grasp the illusion of an event in the formation of the role. germanium feel, sometimes, Soros called them and what the participants thought the difference between the true state is ever-present. < br> Sometimes this difference is small and self-correction, Soros called the quasi-equilibrium to this situation.
sometimes very different, but this self-correction, which he called the situation far from equilibrium .
When this very different from each other, when perception and reality, there is no skill to make the two draw closer, in fact, can only make two separate force.
this far from equilibrium There are two forms of the case. an extreme, although the feeling and the reality is far, but the situation is stable. stable situation for investors such as Soros is not the slightest appeal. the other extreme, in any case , the situation is unstable, the developments so fast, and even the participants thought behind schedule. This situation has a special appeal for George Soros.
the gap between perception and reality is very large, because the situation is out of control This situation is typical of financial markets, often in the market volatility and instability, and the part lies in the identification of a one by one the idea of all these investors, this is the nature of the Soros investment techniques.
Once an investor to understand the market, he may open another River Drive, The unexpected events gamble, assuming a boom bust cycles one hundred and eleven group session and Urban Affairs, made a brief note, for example, no can not discount the future accurately, because they not only discount the future, but also to its formation. unexpected events that bet. imbalance, then actions will be completely different from the idea of efficient market theory of general state. will affect the economic base, because they are very destructive. only when the market is dominated by the behavior of following the trend, the I mean the people to act in a self-reinforcing, prices went to buy, the price dropped to sell. , but not enough to make it happen. At this point, you want to ask the key question is how is followed by the tendency to act? self-cultivation.
Self Development market investors into blind fanaticism or blind herd mentality into another way of saying.
Self Development market, often fanatical overreaction, often go to extremes. This overreaction to the extreme mm mm caused a The key to success is to seize the market opportunity to begin self-nurturing, because recognition of this opportunity, investors will know a shooting followed a dialectical mode of the process of reason can be explained in general terms: the more volatile the market situation, people are more easily affected by market trends; this investment by the greater impact of market trends, market situation more unstable. br> confidence is growing;
the gap between the reality of feeling;
the end, the opposite direction of the beginning of self-reinforcing sequence of images.
Soros has argued that, when a tendency to persist When investment transactions more meaningful. Moreover, they tend to see the bear as a result tend to the more serious, more intense prejudice. Finally, when a tendency to be fixed when the process will begin.
Pak Wing . Wen Morgan in New York. Sistani areas of the U.S. equity investment strategist, is also a close friend of Soros, George Soros's theory that he put in simple language described as:
, will become worse. You should know that when things go very smoothly, it will become worse. to simplify his theory, the most important thing is to realize that change is inevitable that this trend . The key point is to identify the turning point. continue not to rise. According to Soros the feedback theory, the collapse has become unavoidable.
Midas touch
George IV. Soros is an unorthodox investors.
he did not follow the traditional rules to operate the financial market.
while others are so. They think the world and everything in the world is rational.
including the financial market.
Soros when only those who want to know Rule changes will occur only when the rules of the game for those interested., because the rules change, they may trigger a feedback relationship, this feedback may start a .
George. Soros constantly monitor the financial markets, the search for a people are more ways to ride out the storm.
Despite this investment secret, however, may not be able to ensure that Soros can always make a profit. Sometimes, there will be some potential with his element of investment-related issues. Sometimes, there will be investment potential of some of his issues are closely related.
example, sometimes. This feedback process does not exist. Or, that the process is there but Soros did not find them in time. The most worse, Sometimes this feedback process to search for Soros, though found, however, found time to have missed the identification.
Occasionally, Soros to invest, regardless of how the operation of a market that is mm , regardless of the feedback process is under way. But he always looking for feedback process. When he found one and can take advantage of it, he will get a large profit.
Soros acknowledged that his theory is not fully applicable . He does not think his feedback theory to explain the promise of how to make money in financial markets. The goal is more ambitious, he considers his feedback theory that the world can be more aware of his operation.
This is George. Soros philosophical thinking, and not George. Soros's investors based thinking.
the key is to understand biological evolution. can not provide a monumental discovery.
this theory is still flawed. he himself can not determine the .
Finally, Soros admitted ruefully, his theory although the broad. If his theory can be helpful for people to have to say clearly, the scope of his theory of dishonesty you, no. his own theory expect too much. And when these expectations can not become a reality, he should have remained silent, but he did not. Although he did not present a release The universal-all theory, but he is sure he found that some useful. Some people think the same one hundred and eleven large complex and difficult to understand it, some people understand and impressed. were among those confused, there are some people who for years worked with George Soros. One is Robert. Miller, who is Ai Huode. 布雷彻尔德 senior vice president, from the 60's has been working with George Soros.
Miller biographer trying to understand the theoretical understanding of Soros.
result is frustrating.
Biographer: You talked about this with his theory up?
Miller: about Debu most.
biographer: Do you read the .
biographer: Can you talk about this theory can provide people with anything?
Miller: (burst out laughing) may not.
when talking about this theory, others believe it very credible.
William. Dorje is the impartial investigation of the urban land consolidation, senior vice president and New York, Ann. An Weite. Ruilu De head of investment strategy, he admitted he did not read the Soros feedback theory is completely credible.
months, or Introduction. In this preamble, Soros said he would like to make some new feedback theory that made him understand more clearly the meaning of the original. Road, I propose that feedback theory seems to be applicable at all times. from the two-way feedback dynamics, this is the feedback at any time, the role of theories in the event of signs, from one angle, this view is correct. But that feedback theory at work at any time, from the other sense, this view is not correct. In fact, in many cases, it is the dark green do not count bias will affect the market price. And the basis of the so-called stock, that is, when the feedback becomes very important time. This does not happen often, but, in the event, the market price has become a different pattern. market price also played a different role, It reflects not only the so-called base; it has also become the basis of their own to form the new price. prices while ignoring the second mm mm popular prejudices, under certain circumstances, also affect the so-called base, and the market price changes themselves cause the market price changes.
Soros has his own condemnation.
He admitted that he should do, should not be to propose a general theory that the lack of feedback is a special case. but should the feedback as a special case. because the main features of the feedback is that it is only sometimes appears.
his main excuse was that he observed feedback; first not in the financial market, but first as a philosophical category. He acknowledged that if the insistence on a general theory of feedback, he may go too far . Then he wrote, he is wrong as economic theory, that he made mistakes. If the feedback of the situation is only intermittently present, then, economic theory is only an occasional error, it should be correct.
George. Soros feedback theory in the end what is the value? If Soros do not cover this argument, admit that they sometimes do not adhere to this theory; Sometimes people on the financial market reaction, in a manner and at Mang a pair of animals on the environment somewhat similar to the response, then this issue will be much easier to answer. He himself does not know he was that the true meaning of these statements. and, on other occasions, he was proof that the financial market conditions will deteriorate, Because the onset of low back pain of! low back pain episodes it seems that only a limited purpose, as an early reward system. It does not help identify what events will come in the market. However, once identified Soros trouble coming, and this taking an aspirin if he had.
low back pain of his sudden disappearance!