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THE FUTURE OF THE STOCK MARKET |
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Janice Dorn, M.D., Ph.D. Dear Fellow Traders
If you would understand anything, observe its beginning and its development…Aristotle This is a “must watch” video (nearly two hours long) for every single person trading today. You may want to select the Audio Version, rather than the video because you may prefer to listen while doing other things (like cooking holiday dinner or lifting weights!), and the video gets grainy in several segments. My deepest thanks to the New York Psychoanalytic Society and Institute and the Philoctetes group (www.philoctetes.org) for making this video and audio available. It is important to hear what has happened in the past, what is happening now and where we are headed in the future--- not from bubble vision or business infotainment (you will see none of these people there)—rather from the pioneers and those thinking about and working in the trenches with the challenges we individual traders face today. Some vignettes from the discussion:
“With computerized models, greed and fear are intensified because the quants are all looking at the same things, i.e., the herd gets concentrated via what is essentially a one-model system with everyone suffering the same losses at the same time.” “The exchange of the future is a computer, a man and a dog. The computer does the trading, the man feeds the dog and the dog is there to keep the man away from the computer.” “New and diversified algorithms and so-called black box trading will emerge.” “The retail trader—unless he does his homework—is at a disadvantage. You can be efficient if you want to put in the time and do the work.” The questions from the audience are interesting, particularly when they come from real traders. One trader who works and trades for high-end retail investors, believes that the future of the market will be global and seamless through the more than 600 ETF’s (and growing daily!) in existence today. Is this good or bad? There is no way to know what might happen in the event of a “contagion” that spreads rapidly. The professional trader finds a niche all the time. How is the retail trader going to find a niche?” Is diversity through ETF’s the “one free lunch on wall street?” “Are the exchanges (mergers and foreign markets now going into IPO’s) now out to make money and how is that going to affect the markets in the future?” “Is the SEC doing its homework on the mergers of these exchanges, and what will the outcome be?” “The future is global and what happens to our main capital raising ability?” “What is the role of human capital?” What is the relationship between the human and the algorithm and the human and the black box?”
Please
click here to read or
listen: (Once on page,
Scroll Down To View) I send wishes to each of you for a blessed, joyous and healthy holiday season. I send love to you and hopes to the world for peace. Thank you to our brave men and women in the armed forces all over the world who are sacrificing hearth and holiday with family and loved ones in order that we at home may be free to celebrate this magnificent time of year.
Until Next Time,
Good Trading
and Brain On!
Janice Dorn, M.D., Ph.D.
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I
extend my deepest thanks
to each of you for your
support this year. My
hope is that something I
have written or spoken
has touched you in such
a way as to make you a
better trader and a more
highly evolved human
being. My intent is to
continue teaching and
writing with even more
intensity and frequency
during the coming
year. As always, I
encourage and embrace
your feedback and hope
to hear from more of you
as the year progresses.
