From: John Clark (jonkc@worldnet.att.net)
Date: Thu Dec 30 1999 - 15:40:37 MST
Eliezer S. Yudkowsky <sentience@pobox.com> Wrote:
>This year's 80% rise in the Nasdaq index was not caused by an 80%
>improvement in productivity.
True, but as Max pointed out productivity is not the only factor involved.
Nevertheless there is denying productivity is very important in
determining if a stock is worth its price. Even more important is figuring
out how future productivity changes will differ from those we've
seen in the past. If you can do that better than the average investor
then you'll make money in the stock market.
As you know, what we call the "Singularity" (capital S) is not a true singularity,
the rate of change will be astronomically large but not infinitely large. Things just
don't happen instantaneously in the real world, thus I would expect the decade
before the singularity to see a huge rate of productivity increase that is unprecedented
in history, even if it's a thousand times less than during the Singularity itself.
For this reason I believe the long term trend of the market can only be up
and this has given me the courage not to panic (much) and sell everything when
the market dives as it does from time to time. You expect the Singularity to happen
even sooner than I do so I don't understand why you're not fully invested into the
market. It's never a bad thing to have money, especially when things are changing
rapidly, it might even help you steer things in the direction you want them to go.
>Stocks are ludicrously overvalued and everyone knows it.
Well, some stocks are ludicrously overvalued, but I don't buy any of those.
My advice is only buy stocks that are going to go up, adhere rigidly to that
principle any you'll get rich. Absolutely no doubt about it.
John K Clark jonkc@att.net
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