Community Discussions
Explore the latest discussions and community conversations related to this domain.
Arxiv: Markets are efficient if and only if P = NP (Can ... - Reddit
Main Post: Arxiv: Markets are efficient if and only if P = NP (Can ... - Reddit
Markets are Efficient if and Only if P = NP
Main Post: Markets are Efficient if and Only if P = NP
Top Comment: So, I actually read this paper, and for all the people getting excited that "Wee socialism" that's not at all what this paper is about. This paper has a particular definition of efficient that is WAY stricter than the one economists traditionally use to discuss market economics. Specifically, they define market efficiency as the idea that prices IMMEDIATELY reflect a total information awareness of the ENTIRE market. Obviously this is impossible because information takes time to propagate through distribution networks. This isn't the exact proof they use, but its also possible to argue what is claimed in the paper by demonstrating that many NP problems are sub problems of market efficiency. For example, assuming one distribution 'truck' containing resources, efficient market distribution of resources to geographically distributed customers is the classic definition of the TSP. HOWEVER: No free-market advocate in the government sphere has EVER claimed that markets are perfectly optimal instantaneously. Rather, they claim that markets are an evolutionary solution to a very difficult (and now we know NP-hard) optimization problem. Clearly sometimes there are local maxima, but overall the evolution of the market tends to converge towards a global solution. There are no proofs that the market WILL find the global solution (never mind finding it immediately), but there are proofs that the market will converge in the direction of AN optima. In contrast to the "Free Market" evolutionary algorithm to solve the problem, "Government Intervention" tends to be a layer of completely random and uncorrelated heuristics that pushes the evolutionary algorithm in random directions. Sometimes its the push that is needed to get the market out of a local maximum (monopoly), but usually its just a random push in a random direction that benefits a few powerful people. To quote this article: There are approximations to both market efficiency and computational efficiency. Computationally, many problems that are technically in NP can be solved quite quickly with approximations or randomization algorithms. Rodriguez, Villagra, and Baran (2008) show that modern solvers for satisfiability problems can combine different algorithms to interact with each other in a search for a global solution. Even if the worst-case performance is still exponential, many common cases can often be solved much faster. Financially, the “economic calculation problem” of von Mises (1920) and Hayek (1935) suggests, among other things, that, even if a free market is not perfectly efficient, it will certainly be more efficient than a regulatory or government alternative. In other words, even if mispricings occasionally occur, most of the time they are smaller than any other alternative system. Both of those arguments are similar in their domains but neither applies to the results of this paper. Whether markets are efficient or not, and whether P = NP or not, there is no doubt that there will be markets that can allocate resources very close to efficiently and there will be algorithms that can solve problems very close to efficiently. The results of this paper should not be interpreted as support for government intervention into the market; on the contrary, the fact that market efficiency and computational efficiency are linked suggests quite clearly that government should no more intervene in the market or regulate market participants than it should intervene in computations or regulate computer algorithms."
J.P Morgan Guide to the Markets - Q1 2022
Main Post: J.P Morgan Guide to the Markets - Q1 2022
Top Comment:
I can’t see another but mods please delete this if it has already been posted
iShares J.P. Morgan $ Emerging Markets Bond UCITS ETF - USD DIS
Main Post:
Moin
Ich würde gerne mal eure Meinung zu dem ETF "iShares J.P. Morgan $ Emerging Markets Bond UCITS ETF - USD DIS" einholen (bzw. zu ähnlichen Anleihe ETF bzgl. EM). Dieser hat mit 6Mrd ja recht groß, verliert aber in letzter Zeit immer an Wert.
Ich hab zwar meine eigene "Laien-Idee" zu dem "warum", aber mich würde mal eure Meinung interessieren.
Alle Antworten werden nicht als "Anlageempfehlung" betrachtet, keine Sorge.
Danke
Top Comment:
Primär, weil der EUR ggü. den USD seit Oct22 stark aufgewertet hat (+16%). Sekundär, weil hohe Zinsen und die fehlende Liquidität in den Eurodollarmärkten für die Bonität der EM negativ ist.
Zudem würde ich dabei auch nicht von Wertverlust sprechen, YTD mit Ausschüttungen ±0.
In den US gibt es sogar einen fast gleichnamigen ETF, welcher dort in USD YTD +5,48%. https://finance.yahoo.com/quote/EMB/performance?p=EMB
J.P. Morgan Guide to the Markets Q3 2022
Main Post: J.P. Morgan Guide to the Markets Q3 2022
Top Comment:
Page 13 is my favorite. Small cap is the only asset class on a significant discount