Thursday, September 4, 2008

Shares market VS Economic theory

A lot of analyst treated the shares market as normal trading market. In their mind, demand and supply theory fully adopting in the market. Hence, always advice people buy in low and sell at high. Is it the present shares market working it simple and direct?

In the early 1970 and beginning of 1980, I believed the above theory fully reflected in the shares market. Because of the limited of share issue and limited of company listed. The environment evidence already proved that the above theory is right.

Now, If your are still applying the same normal economic theory in the equity market and commodity market. I believed you are now facing financial difficulties.

The complex of trading activities and manipulation issue actually total injected into simple trading market. Hence, I do believe this crisis or future crisis happen in the economic or equities market is deep and long.

Human become smarter or maybe human desire become hungrier always brings the simple thing convert it become harder and difficult.

So, if you are a simple investor in the market. This is a time for you to retire immediately. This game was not longer fit to you. If you are continue playing and adopting the simple theory. I do believe one day you assets will be burn it to negative.

Please understand more others factors will direct or indirect influence the market before you invest in the equity market. Not only one theory, it must be 10 or 15 theories adopting in the same time. This only can help you be a winner.

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