Markets Fluctuate Quotes

These labourers, who must sell themselves piece-meal, are a commodity, like every other article of commerce, and are consequently exposed to all the vicissitudes of competition, to all the fluctuations of the market.

Markets fluctuate and markets can be unpredictable at times. This is why having a resilient portfolio is critical. Growth without resilience only ends in extreme loss. But resilience protects assets from loss.

Any board-room sitter with a taste for Wall Street lore has heard of the retort that J. P. Morgan the Elder is supposed to have made to a naïve acquaintance who had ventured to ask the great man what the market was going to do. “It will fluctuate,” replied Morgan dryly.

Even in those earlier times, finding the really outstanding companies and staying with them through all the fluctuations of a gyrating market proved far more profitable to far more people than did the more colorful practice of trying to buy them cheap and sell them dear.

For the rest of his life, the greater the chaos, the calmer Rockefeller would become, particularly when others around him were either panicked or mad with greed. He would make much of his fortune during these market fluctuations—because he could see while others could not. This insight lives on today in Warren Buffet’s famous adage to “be fearful when others are greedy and greedy when others are fearful.” Rockefeller, like all great investors, could resist impulse in favor of cold, hard common sense.

Economic theory is devoted to the study of equilibrium positions. The concept of equilibrium is very useful. It allows us to focus on the final outcome rather than the process that leads up to it. But the concept is also very deceptive. It has the aura of something empirical: since the adjustment process is supposed to lead to an equilibrium, an equilibrium position seems somehow implicit in our observations. That is not true. Equilibrium itself has rarely been observed in real life — market prices have a notorious habit of fluctuating.

Scratching off a postcard to Charlie Taylor, Orville expressed the same spirit in a lighter vein. Flying machine market has been very unsteady the past two days. Opened yesterday morning at about 208 (100% means even chance of success) but by noon had dropped to 110. These fluctuations would have produced a panic, I think, in Wall Street, but in this quiet place it only put us to thinking and figuring a little.

The most realistic distinction between the investor and the speculator is found in their attitude toward stock-market movements. The speculator’s primary interest lies in anticipating and profiting from market fluctuations. The investor’s primary interest lies in acquiring and holding suitable securities at suitable prices. Market movements are important to him in a practical sense, because they alternately create low price levels at which he would be wise to buy and high price levels at which he certainly should refrain from buying and probably would be wise to sell. It is far from certain that the typical investor should regularly hold off buying until low market levels appear, because this may involve a long wait, very likely the loss of income, and the possible missing of investment opportunities. On the whole it may be better for the investor to do his stock buying whenever he has money to put in stocks, except when the general market level is much higher than can be justified by well-established standards of value. If he wants to be shrewd he can look for the ever-present bargain opportunities in individual securities. Aside from forecasting the movements of the general market, much effort and ability are directed on Wall Street toward selecting stocks or industrial groups that in matter of price will “do better” than the rest over a fairly short period in the future. Logical as this endeavor may seem, we do not believe it is suited to the needs or temperament of the true investor—particularly since he would be competing with a large number of stock-market traders and first-class financial analysts who are trying to do the same thing. As in all other activities that emphasize price movements first and underlying values second, the work of many intelligent minds constantly engaged in this field tends to be self-neutralizing and self-defeating over the years. The investor with a portfolio of sound stocks should expect their prices to fluctuate and should neither be concerned by sizable declines nor become excited by sizable advances. He should always remember that market quotations are there for his convenience, either to be taken advantage of or to be ignored. He should never buy a stock because it has gone up or sell one because it has gone down. He would not be far wrong if this motto read more simply: “Never buy a stock immediately after a substantial rise or sell one immediately after a substantial drop.” An

Thus Marx begins his attack on the liberal concept of freedom. The freedom of the market is not freedom at all. It is a fetishistic illusion. Under capitalism, individuals surrender to the discipline of abstract forces (such as the hidden hand of the market made much of by Adam Smith) that effectively govern their relations and choices. I can make something beautiful and take it to market, but if I don’t manage to exchange it then it has no value. Furthermore, I won’t have enough money to buy commodities to live. Market forces, which none of us individually control, regulate us. And part of what Marx wants to do in Capital is talk about this regulatory power that occurs even “in the midst of the accidental and ever-fluctuating exchange relations between the products.” Supply and demand fluctuations generate price fluctuations around some norm but cannot explain why a pair of shoes on average trades for four shirts. Within all the confusions of the marketplace, “the labour-time socially necessary to produce [commodities] asserts itself as a regulative law of nature. In the same way, the law of gravity asserts itself when a person’s house collapses on top of him” (168). This parallel between gravity and value is interesting: both are relations and not things, and both have to be conceptualized as immaterial but objective.

The markets fluctuated alarmingly for the rest of the month, falling one day, recovering the next, then plummeting another, leaving speculators alternating between relief and hysteria. By the end of November, with many nervous New Yorkers clamoring for reassurances, Strong confided he was as fearful about Northern capitulation as he was about Southern belligerence. “Our national mottoes must be changed to ‘e pluribus duo’ (at least) and ‘United we stand, divided we stand easier.

It is not by means of a metaphor that a banking or stock-market transaction, a claim, a coupon, a credit, is able to arouse people who are not necessarily bankers. And what about the effects of money that grows, money that produces more money? There are socioeconomic "complexes" that are also veritable complexes of the unconscious, and that communicate a voluptuous wave from the top to the bottom of their hierarchy (the military-industrial complex). And ideology, Oedipus, and the phallus have nothing to do with this, because they depend on it rather than being its impetus. For it is a matter of flows, of stocks, of breaks in and fluctuations of flows; desire is present wherever something flows and runs, carrying along with it interested subjects—but also drunken or slumbering subjects—toward lethal destinations.

Humboldt was the first to relate colonialism to the devastation of the environment. Again and again, his thoughts returned to nature as a complex web of life but also to man’s place within it. At the Rio Apure, he had seen the devastation caused by the Spanish who had tried to control the annual flooding by building a dam. To make matters worse, they had also felled the trees that had held the riverbanks together like ‘a very tight wall’ with the result that the raging river carried more land away each year. On the high plateau of Mexico City, Humboldt had observed how a lake that fed the local irrigation system had shrunk into a shallow puddle, leaving the valleys beneath barren. Everywhere in the world, Humboldt said, water engineers were guilty of such short-sighted follies. He debated nature, ecological issues, imperial power and politics in relation to each other. He criticized unjust land distribution, monocultures, violence against tribal groups and indigenous work conditions – all powerfully relevant issues today. As a former mining inspector, Humboldt had a unique insight into the environmental and economic consequences of the exploitation of nature’s riches. He questioned Mexico’s dependence on cash crops and mining, for example, because it bound the country to fluctuating international market prices. ‘The only capital,’ he said, that ‘increases with time, consists in the produce of agriculture’. All problems in the colonies, he was certain, were the result of the ‘imprudent activities of the Europeans’.

Financial markets are far too complex to isolate any single variable with ease, as if conducting a scientific experiment. The record is utterly bereft of evidence that definitive predictions of short-term fluctuations in stock prices can be made with consistent accuracy. The prices of common stocks are evanescent and illusory.

He would make much of his fortune during these market fluctuations—because he could see while others could not. This insight lives on today in Warren Buffet’s famous adage to “be fearful when others are greedy and greedy when others are fearful.” Rockefeller, like all great investors, could resist impulse in favor of cold, hard common sense. One

The proletariat, a class of laborers,who live only so long as they find work,and who find work only so long as their labor increases capital. These laborers, who must sell themselves piecemeal, are a commodity,like every other article of commerce, and are consequently exposed to all the vicissitudes of competition, to all the fluctuations of the market.

This arrangement, in which users take advantage of services and the company gains all the upside of the data they generate, may sound novel, but it is actually very old. Prior to the rise of capitalism, feudal labor arrangements worked similarly. Lords insulated their serfs from fluctuations in markets and guaranteed them safety and traditional rights to use the land and to keep enough of their crop to survive. In exchange, lords took all the upside of the market return on serfs’ agricultural output. Similarly, today, siren servers provide useful and enjoyable information services, while taking the market value of the data we produce in exchange. We thus refer to this contemporary system as “technofeudalism.

We find the same situation in the economy. On the one hand, the battered remnants of production and the real economy; on the other, the circulation of gigantic amounts of virtual capital. But the two are so disconnected that the misfortunes which beset that capital – stock market crashes and other financial debacles – do not bring about the collapse of real economies any more. It is the same in the political sphere: scandals, corruption and the general decline in standards have no decisive effects in a split society, where responsibility (the possibility that the two parties may respond to each other) is no longer part of the game. This paradoxical situation is in a sense beneficial: it protects civil society (what remains of it) from the vicissitudes of the political sphere, just as it protects the economy (what remains of it) from the random fluctuations of the Stock Exchange and international finance. The immunity of the one creates a reciprocal immunity in the other – a mirror indifference. Better: real society is losing interest in the political class, while nonetheless availing itself of the spectacle. At last, then, the media have some use, and the ‘society of the spectacle’ assumes its full meaning in this fierce irony: the masses availing themselves of the spectacle of the dysfunctionings of representation through the random twists in the story of the political class’s corruption. All that remains now to the politicians is the obligation to sacrifice themselves to provide the requisite spectacle for the entertainment of the people.

Profit is so very fluctuating that the person who carries on a particular trade cannot always tell you himself what is the average of his annual profit. It is affected not only by every variation of price in the commodities which he deals in, but by the good or bad fortune both of his rivals and of his customers, and by a thousand other accidents to which goods when carried either by sea or by land, or even when stored in a warehouse, are liable. It varies, therefore, not only from year to year, but from day to day, and almost from hour to hour. To ascertain what is the average profit of all the different trades carried on in a great kingdom must be much more difficult; and to judge of what it may have been formerly, or in remote periods of time, with any degree of precision, must be altogether impossible. But though it may be impossible to determine, with any degree of precision, what are or were the average profits of stock, either in the present or in ancient times, some notion may be formed of them from the interest of money. It may be laid down as a maxim, that wherever a great deal can be made by the use of money, a great deal will commonly be given for the use of it; and that wherever little can be made by it, less will commonly be given for it. According, therefore, as the usual market rate of interest varies in any country, we may be assured that the ordinary profits of stock must vary with it, must sink as it sinks, and rise as it rises. The progress of interest, therefore, may lead us to form some notion of the progress of profit.

If the market were a disciplined calculator of value based exclusively on company fundamentals, the price of a security wouldn’t fluctuate much more than the issuer’s current earnings and the outlook for earnings in the future. In fact, the price generally should fluctuate less than earnings, since quarter-to-quarter changes in earnings often even out in the long run and, besides, don’t necessarily reflect actual changes in the company’s long-term potential.

Weather patterns in the Pacific were not human-driven, but the futures market in Chicago was. The world had shifted so rapidly from subsistence agriculture to a market economy that price fluctuations sent ripples throughout the system, destabilizing entire regions. Traders could now set off starvation halfway across the world with the touch of a telegraph key, sucking up grain supplies in India or the Dakotas and sending them to Europe, where prices were high. It was the dawn of “price famines.”174

The most prominent characteristic of capitalism is the wage system, which in brief amounts to this: — A man, or a group of men, possessing the necessary capital, starts some industrial enterprise; he undertakes to supply the factory or workshops with raw material, to organize production, to pay the employés a fixed wage, and lastly, to pocket the surplus value or profits, under pretext of recouping himself for managing the concern, for running the risks it may involve, and for the fluctuations of price in the market value of the wares.

Seen through the lens of human perception, cycles are often viewed as less symmetrical than they are. Negative price fluctuations are called “volatility,” while positive price fluctuations are called “profit.” Collapsing markets are called “selling panics,” while surges receive more benign descriptions (but I think they may best be seen as “buying panics”; see tech stocks in 1999, for example). Commentators talk about “investor capitulation” at the bottom of market cycles, while I also see capitulation at the top, when previously prudent investors throw in the towel and buy.

If you are going to use probability to model a financial market, then you had better use the right kind of probability. Real markets are wild. Their price fluctuations can be hair-raising-far greater and more damaging than the mild variations of orthodox finance. That means that individual stocks and currencies are riskier than normally assumed. It means that stock portfolios are being put together incorrectly; far from managing risk, they may be magnifying it. It means that some trading strategies are misguided, and options mis-priced. Anywhere the bell-curve assumption enters the financial calculations, an error can come out.

THE economic consequences of fluctuations in the objective exchange-value of money have such important bearings on the life of the community and of the individual that as soon as the State had abandoned the attempt to exploit for fiscal ends its authority in monetary matters, and as soon as the large-scale development of the modern economic community had enabled the State to exert a decisive influence on the kind of money chosen by the market, it was an obvious step to think of attaining certain socio-political aims by influencing these consequences in a systematic manner. Modern currency policy is something essentially new; it differs fundamentally from earlier State activity in the monetary sphere.

By standardizing values into easily identifiable units, coins allowed for the creation of large markets, increasing the scope of specialization and trade worldwide. While the best monetary system technologically possible at the time, it still had two major drawbacks: the first was that the existence of two or three metals as the monetary standard created economic problems from the fluctuation of their values over time due to the ebbs of supply and demand, and created problems for owners of these coins, particularly silver, which experienced declines in value due to increases in production and drops in demand. The second, more serious flaw was that governments and counterfeiters could, and frequently did, reduce the precious metal content in these coins, causing their value to decline by transferring a fraction of their purchasing power to the counterfeiters or the government.

An attempt is sometimes made to demonstrate the desirability of measures directed against speculation by reference to the fact that there are times when there is nobody in opposition to the bears in the foreign-exchange market so that they alone are able to determine the rate of exchange. That, of course, is not correct. Yet it must be noticed that speculation has a peculiar effect in the case of a currency whose progressive depreciation is to be expected while it is impossible to foresee when the depreciation will stop, if at all. While, in general, speculation reduces the gap between the highest and lowest prices without altering the average price-level, here, where the movement will presumably continue in the same direction, this naturally can not be the case. The effect of speculation here is to permit the fluctuation, which would otherwise proceed more uniformly, to proceed by fits and starts with the interposition of pauses.

This move by President Nixon completed the process begun with World War I, transforming the world economy from a global gold standard to a standard based on several government-issued currencies. For a world that was growing increasingly globalized along with advancements in transportation and telecommunications, freely fluctuating exchange rates constituted what Hoppe termed “a system of partial barter.”13 Buying things from people who lived on the other side of imaginary lines in the sand now required utilizing more than one medium of exchange and reignited the age-old problem of lack of coincidence of wants. The seller does not want the currency held by the buyer, and so the buyer must purchase another currency first, and incur conversion costs. As advances in transportation and telecommunications continue to increase global economic integration, the cost of these inefficiencies just keeps getting bigger. The market for foreign exchange, at $5 trillion of daily volume, exists purely as a result of this inefficiency of the absence of a single global homogeneous international currency.

A few years ago my friend Jon Brooks supplied this great illustration of skewed interpretation at work. Here’s how investors react to events when they’re feeling good about life (which usually means the market has been rising): Strong data: economy strengthening—stocks rally Weak data: Fed likely to ease—stocks rally Data as expected: low volatility—stocks rally Banks make $4 billion: business conditions favorable—stocks rally Banks lose $4 billion: bad news out of the way—stocks rally Oil spikes: growing global economy contributing to demand—stocks rally Oil drops: more purchasing power for the consumer—stocks rally Dollar plunges: great for exporters—stocks rally Dollar strengthens: great for companies that buy from abroad—stocks rally Inflation spikes: will cause assets to appreciate—stocks rally Inflation drops: improves quality of earnings—stocks rally Of course, the same behavior also applies in the opposite direction. When psychology is negative and markets have been falling for a while, everything is capable of being interpreted negatively. Strong economic data is seen as likely to make the Fed withdraw stimulus by raising interest rates, and weak data is taken to mean companies will have trouble meeting earnings forecasts. In other words, it’s not the data or events; it’s the interpretation. And that fluctuates with swings in psychology.

The market's second wild trait-almost-cycles-is prefigured in the story of Joseph. Pharaoh dreamed that seven fat cattle were feeding in the meadows, when seven lean kine rose out of the Nile and ate them. Likewise, seven scraggly ears of corn consumed seven plump ears. Joseph, a Hebrew slave, called the dreams prophetic: Seven years of famine would follow seven years of prosperity. He advised Pharaoh to stockpile grain for bad times to come. And when all passed as prophesied, "Joseph opened all the storehouses, and sold unto the Egyptians...And all countries came into Egypt to Joseph to buy corn; because that the famine was so sore in all lands." Given the profits he and Pharaoh must have made, one might call Joseph the first international arbitrageur. That pattern, familiar from Hurst's work on the Nile, also appears in markets. A big 3 percent change in IBM's stock one day might precede a 2 percent jump another day, then a 1.5 percent change, then a 3.5 percent move-as if the first big jumps were continuing to echo down the succeeding days' trading. Of course, this is not a regular or predictable pattern. But the appearance of one is strong. Behind it is the influence of long-range dependence in an otherwise random process-or, put another way, a long-term memory through which the past continues to influence the random fluctuations of the present.

Putting it all together, fluctuations in attitudes and behavior combine to make the stock market the ultimate pendulum. In my 47 full calendar years in the investment business, starting with 1970, the annual returns on the S&P 500 have swung from plus 37% to minus 37%. Averaging out good years and bad years, the long-run return is usually stated as 10% or so. Everyone’s been happy with that typical performance and would love more of the same. But remember, a swinging pendulum may be at its midpoint “on average,” but it actually spends very little time there. The same is true of financial market performance. Here’s a fun question (and a good illustration): for how many of the 47 years from 1970 through 2016 was the annual return on the S&P 500 within 2% of “normal”—that is, between 8% and 12%? I expected the answer to be “not that often,” but I was surprised to learn that it had happened only three times! It also surprised me to learn that the return had been more than 20 percentage points away from “normal”—either up more than 30% or down more than 10%—more than one-quarter of the time: 13 out of the last 47 years. So one thing that can be said with total conviction about stock market performance is that the average certainly isn’t the norm. Market fluctuations of this magnitude aren’t nearly fully explained by the changing fortunes of companies, industries or economies. They’re largely attributable to the mood swings of investors. Lastly, the times when return is at the extremes aren’t randomly distributed over the years. Rather they’re clustered, due to the fact that investors’ psychological swings tend to persist for a while—to paraphrase Herb Stein, they tend to continue until they stop. Most of those 13 extreme up or down years were within a year or two of another year of similarly extreme performance in the same direction.

The blinking message light on the phone screamed at us when we walked into the bedroom of our suite. Marlboro Man audibly exhaled, clearly wishing the world--and his brother and the grain markets and the uncertainties of agriculture--would leave us alone already. I wish they’d leave us alone, too. In light of the recent developments, though, Marlboro Man picked up the phone and dialed Tim to get an update. I excused myself to the bathroom to freshen up and put on a champagne satin negligee in an effort to thwart the external forces that were trying to rob me of my husband’s attention. I brushed my teeth and spritzed myself with Jil Sander perfume before opening the door to the bedroom, where I would seduce my Marlboro Man away from his worries. I knew I could win if only I applied myself. He was just getting off the phone when I entered the room. “Dammit,” I heard him mumble as he plopped down onto the enormous king-size bed. Oh no. Jil Sander had her work cut out for her. I climbed on the bed and lay beside him, resting my head on his arm. He draped his arm across my waist. I draped my leg around his. He sighed. “The markets are totally in the shitter.” I didn’t know the details, but I did know the shitter wasn’t a good place. I wanted to throw out the usual platitudes. Don’t worry about it, try not to think about it, we’ll figure it out, everything will be okay. But I didn’t know enough about it. I knew he and his brother owned a lot of land. I knew they worked hard to pay for it. I knew they weren’t lawyers or physicians by profession and didn’t have a whole separate income to supplement their ranching operation. As full-time ranchers, their livelihoods were completely reliant on so many things outside of their control--weather, market fluctuations, supply, demand, luck. I knew they weren’t home free in terms of finances--Marlboro Man and I had talked about it. But I didn’t understand enough about the ramifications of this current wrinkle to reassure him that everything would be okay, businesswise. And he probably didn’t want me to. So I did the only thing I could think of to do. I assured my new husband everything would be okay between us by leaning over, turning off the lamp, and letting the love between us--which had zero to do with markets or grains--take over.

What is certain is that the immutable classes, the nobility, the clergy, the bourgeoisie, the people, had loftier souls at that time. You can prove it: society has done nothing but deteriorate in the four centuries separating us from the Middle Ages. "True, a baron then was usually a formidable brute. He was a drunken and lecherous bandit, a sanguinary and boisterous tyrant, but he was a child in mind and spirit. The Church bullied him, and to deliver the Holy Sepulchre he sacrificed his wealth, abandoned home, wife, and children, and accepted unconscionable fatigues, extraordinary sufferings, unheard-of dangers. "By pious heroism he redeemed the baseness of his morals. The race has since become moderate. It has reduced, sometimes even done away with, its instincts of carnage and rape, but it has replaced them by the monomania of business, the passion for lucre. It has done worse. It has sunk to such a state of abjectness as to be attracted by the doings of the lowest of the low. ...cupidity was repressed by the confessor, and the tradesman, just like the labourer, was maintained by the corporations, which denounced overcharging and fraud, saw that decried merchandise was destroyed, and fixed a fair price and a high standard of excellence for commodities. Trades and professions were handed down from father to son. The corporations assured work and pay. People were not, as now, subject to the fluctuations of the market and the merciless capitalistic exploitation. Great fortunes did not exist and everybody had enough to live on. Sure of the future, unhurried, they created marvels of art, whose secret remains for ever lost. "All the artisans who passed the three degrees of apprentice, journeyman, and master, developed subtlety and became veritable artists. They ennobled the simplest of iron work, the commonest faience, the most ordinary chests and coffers. Those corporations, putting themselves under the patronage of Saints—whose images, frequently besought, figured on their banners—preserved through the centuries the honest existence of the humble and notably raised the spiritual level of the people whom they protected. ...The bourgeoise has taken the place forfeited by a wastrel nobility which now subsists only to set ignoble fashions and whose sole contribution to our 'civilization' is the establishment of gluttonous dining clubs, so-called gymnastic societies, and pari-mutuel associations. Today the business man has but these aims, to exploit the working man, manufacture shoddy, lie about the quality of merchandise, and give short weight. ...There is one word in the mouths of all. Progress. Progress of whom? Progress of what? For this miserable century hasn't invented anything great. "It has constructed nothing and destroyed everything...

No sound strategy for studying fascism can fail to examine the entire context in which it was formed and grew. Some approaches to fascism start with the crisis to which fascism was a response, at the risk of making the crisis into a cause. A crisis of capitalism, according to Marxists, gave birth to fascism. Unable to assure ever-expanding markets, ever-widening access to raw materials, and ever-willing cheap labor through the normal operation of constitutional regimes and free markets, capitalists were obliged, Marxists say, to find some new way to attain these ends by force. Others perceive the founding crisis as the inadequacy of liberal state and society (in the laissez-faire meaning of liberalism current at that time) to deal with the challenges of the post-1914 world. Wars and revolutions produced problems that parliament and the market—the main liberal solutions—appeared incapable of handling: the distortions of wartime command economies and the mass unemployment attendant upon demobilization; runaway inflation; increased social tensions and a rush toward social revolution; extension of the vote to masses of poorly educated citizens with no experience of civic responsibility; passions heightened by wartime propaganda; distortions of international trade and exchange by war debts and currency fluctuations. Fascism came forward with new solutions for these challenges. Fascists hated liberals as much as they hated socialists, but for different reasons. For fascists, the internationalist, socialist Left was the enemy and the liberals were the enemies’ accomplices. With their hands-off government, their trust in open discussion, their weak hold over mass opinion, and their reluctance to use force, liberals were, in fascist eyes, culpably incompetent guardians of the nation against the class warfare waged by the socialists. As for beleaguered middle-class liberals themselves, fearful of a rising Left, lacking the secret of mass appeal, facing the unpalatable choices offered them by the twentieth century, they have sometimes been as ready as conservatives to cooperate with fascists. Every strategy for understanding fascism must come to terms with the wide diversity of its national cases. The major question here is whether fascisms are more disparate than the other “isms.” This book takes the position that they are, because they reject any universal value other than the success of chosen peoples in a Darwinian struggle for primacy. The community comes before humankind in fascist values, and respecting individual rights or due process gave way to serving the destiny of the Volk or razza. Therefore each individual national fascist movement gives full expression to its own cultural particularism. Fascism, unlike the other “isms,” is not for export: each movement jealously guards its own recipe for national revival, and fascist leaders seem to feel little or no kinship with their foreign cousins. It has proved impossible to make any fascist “international” work.

To understand what that means in commonsense terms, consider a person who plans to live off the income from $1 million invested in T-bills. Suppose he retires in a given year and converts his investments into an inflation-protected annuity with a return of 4% to 5%. He will receive an annual income of $40,000 to $50,000. But now suppose he retires a few years later, when the return on the annuity has dropped to 0.5%. His annual income will now be only $5,000. Yes, the $1 million principal amount was fully insured and protected, but you can see that he cannot possibly live on the amount he will now receive. T-bills preserve principal at all times, but the income received on them can vary enormously as return on the annuity goes up or down. Had the retiree bought instead a long-maturity U.S. Treasury bond with his $1 million, his spendable income would be secure for the life of the bond, even though the price of that bond would fluctuate substantially from day to day. The same holds true for annuities: Although their market value varies from day to day, the income from an annuity is secure throughout the retiree’s life.

A long-term temperament as well as long-term circumstances A Japanese man went into a bank to change some Japanese notes into sterling. He was surprised at how little he got. “Please explain,” he said to the cashier. “Yesterday I was changing same yen for sterling and I received many more sterling. Why is this?” The cashier shrugged his shoulders. “Fluctuations,” he explained. The Japanese man was aghast. “And fluck you bloody Europeans too,” he responded, grabbed the notes, and walked out. Fluctuations matter if the money could be needed soon. Money invested in equities must not be money which will be wanted in a year or two, or might be urgently wanted at any time, because there is a fair chance that the moment when it is needed will be a bad one for the stock market and the investor will therefore be selling at low prices. If investors think they might need the money soon, the message is clearly stay away: the chance of a minus return is just too great. Even if investors are in a position to allocate a fair amount to equities, they should not necessarily do so. It is not enough that the circumstances are right. Investors need to be temperamentally inclined to the sort of long-term investment which equities are. Long-termness must be subjective as well as objective. The fact that the circumstances of a particular investor might objectively lead to a certain viewpoint does not mean that he or she necessarily has that viewpoint. A baby is in an objective position to take a long-term view, but will not actually look beyond the next feeding-time.

If your needs are not attainable through safe instruments, the solution is not to increase the rate of return by upping the level of risk. Instead, goals may be revised, savings increased, or income boosted through added years of work. . . . Somebody has to care about the consequences if uncertainty is to be understood as risk. . . . As we’ve seen, the chances of loss do decline over time, but this hardly means that the odds are zero, or negligible, just because the horizon is long. . . . In fact, even though the odds of loss do fall over long periods, the size of potential losses gets larger, not smaller, over time. . . . The message to emerge from all this hype has been inescapable: In the long run, the stock market can only go up. Its ascent is inexorable and predictable. Long-term stock returns are seen as near certain while risks appear minimal, and only temporary. And the messaging has been effective: The familiar market propositions come across as bedrock fact. For the most part, the public views them as scientific truth, although this is hardly the case. It may surprise you, but all this confidence is rather new. Prevailing attitudes and behavior before the early 1980s were different. Fewer people owned stocks then, and the general popular attitude to buying stocks was wariness, not ebullience or complacency. . . . Unfortunately, the American public’s embrace of stocks is not at all related to the spread of sound knowledge. It’s useful to consider how the transition actually evolved—because the real story resists a triumphalist interpretation. . . . Excessive optimism helps explain the popularity of the stocks-for-the-long-run doctrine. The pseudo-factual statement that stocks always succeed in the long run provides an overconfident investor with more grist for the optimistic mill. . . . Speaking with the editors of Forbes.com in 2002, Kahneman explained: “When you are making a decision whether or not to go for something,” he said, “my guess is that knowing the odds won’t hurt you, if you’re brave. But when you are executing, not to be asking yourself at every moment in time whether you will succeed or not is certainly a good thing. . . . In many cases, what looks like risk-taking is not courage at all, it’s just unrealistic optimism. Courage is willingness to take the risk once you know the odds. Optimistic overconfidence means you are taking the risk because you don’t know the odds. It’s a big difference.” Optimism can be a great motivator. It helps especially when it comes to implementing plans. Although optimism is healthy, however, it’s not always appropriate. You would not want rose-colored glasses in a financial advisor, for instance. . . . Over the long haul, the more you are exposed to danger, the more likely it is to catch up with you. The odds don’t exactly add, but they do accumulate. . . . Yet, overriding this instinctive understanding, the prevailing investment dogma has argued just the reverse. The creed that stocks grow steadily safer over time has managed to trump our common-sense assumption by appealing to a different set of homespun precepts. Chief among these is a flawed surmise that, with the passage of time, downward fluctuations are balanced out by compensatory upward swings. Many people believe that each step backward will be offset by more than one step forward. The assumption is that you can own all the upside and none of the downside just by sticking around. . . . If you find yourself rejecting safe investments because they are not profitable enough, you are asking the wrong questions. If you spurn insurance simply because the premiums put a crimp in your returns, you may be destined for disappointment—and possibly loss.

A key point in my work: Randomness has more than one "state," or form, and each, if allowed to play out on a financial market, would have a radically different effect on the way prices behave. One is the most familiar and manageable form of chance, which I call "mild." It is the randomness of a coin toss, the static of a badly tuned radio. Its classic mathematical expression is the bell curve, or "normal" probability distribution-so-called because it was long viewed as the norm in nature. Temperature, pressure, or other features of nature under study are assumed to vary only so much, and not an iota more, from the average value. At the opposite extreme is what I call "wild" randomness. This is far more irregular, more unpredictable. It is the variation of the Cornish coastline-savage promontories, craggy rocks, and unexpectedly calm bays. The fluctuation from one value to the next is limitless and frightening. In between the two extremes is a third state, which I call "slow" randomness.

The factors that determine activity on the Exchange are innumerable, with events, current or expected, often bearing no apparent relation to price variation. Beside the somewhat natural causes for variation come artificial causes: The Exchange reacts to itself, and the current trading is a function, not only of prior trading, but also of its relationship to the rest of the market. The determination of this activity depends on an infinite number of factors. It is thus impossible to hope for mathematical forecasting. Contradictory opinions about these variations are so evenly divided that at the same instant buyers expect a rise and sellers a fall. The calculus of probability can doubtless never be applied to market activity, and the dynamics of the Exchange will never be an exact science. But it is possible to study mathematically the state of the market at a given instant- that is to say, to establish the laws of probability for price variation that the market at the instant dictates. If the market, in effect, does not predict its fluctuations, it does not assess them as being more or less likely, and this likelihood can be evaluated mathematically.

First, price changes are not independent of each other. Research over the past few decades, by me and then by others, shows that many financial price series have a "memory," of sorts. Today does, in fact, influence tomorrow. If prices take a big leap up or down now, there is a measurably greater likelihood that they will move just as violently the next day. It is not a well-behaved, predictable pattern of the kind economists prefer-not, say, the periodic up-and-down procession from boom to bust with which textbooks trace the standard business cycle. Examples of such simple patterns, periodic correlations between prices past and present, have long been observed in markets-in, say, the seasonal fluctuations of wheat futures prices as the harvest matures, or the daily and weekly trends of foreign exchange volume as the trading day moves across the globe.

I am not in the business of predicting general stock market or business fluctuations. If you think I can do this, or think it is essential to an investment program, you should not be in the partnership.

The part of national income that is available to families, after taxes have been paid and any transfers received, is personal disposable income, which is the second line from the top. It is a good deal smaller than GDP, but the historical picture of growth and fluctuation is very similar. Much the same is true if we look, not at what people get, but at what they spend. This is consumers’ expenditure, the third line. The difference between personal disposable income and consumers’ expenditure is the amount that people save, and the figure shows that the fraction of their income that Americans save has been falling, especially over the past thirty years. We don’t know exactly why this has happened, and there are several possible explanations: it is easier to borrow than it used to be; it is no longer as necessary as it once was to save up to make the deposit on a house, a car, or a dishwasher; Social Security has perhaps reduced the need to save for retirement; and the average American benefited from increases in the stock market and in house prices—at least until the Great Recession.

Investors should avoid any urge to forecast the stock market. Forecasts, even forecasts by recognized “experts,” are unlikely to be better than random guesses. “It will fluctuate,” declared J. P. Morgan when asked about his expectation for the stock market. He was right. All other market forecasts—usually estimating the overall direction of the stock market—are historically about 50 percent right and 50 percent wrong. You wouldn’t bet much money on a coin toss, so don’t even think of acting on stock market forecasts.

A 2009 World Bank report on Arab food security warned, “Arab countries are very vulnerable to fluctuations in international commodity markets because they are heavily dependent on imported food. Arab countries are the largest importers of cereal in the world. Most import at least 50 percent of the food calories they consume.”13

The Pharoah on Marriage The Hebrew Proverbs teaches us that a quarrelsome wife is like constant dripping on a rainy day. A noble wife is worth a price far beyond rubies. The Bible forgot to mention that even the most noble wife can nag and push your buttons and her value can drop like a hot potato, and even the most quarrelsome of wives can suck your cock like a Hoover and her mouth can be priceless beyond emeralds. The Pharoah has spoken. Such as the market fluctuations of the human heart. So let it be written, so let it be done.

The nod of recognition that such a purse elicited from a few equally solvent others was an unimpeachable sort of currency, not subject to market fluctuations or whims of fashion.

I will move my money in for a week to a month while the stock moves up. Then I pull my initial dollar amount out, and stop worrying about the fluctuations of the market, because my initial money is back and ready to work on another asset. So my money goes in, and then it comes out, and I own an asset that was technically free.

Here are the most important influences: the way investors fluctuate rather than hold firmly to rational thinking and the resulting rational decisions; the tendency of investors to hold distorted views of what’s going on, engaging in selective perception and skewed interpretation; quirks like confirmation bias, which makes people accept evidence that confirms their thesis and reject that which doesn’t, and the tendency toward non-linear utility, which causes most people to value a dollar lost more highly than a dollar made (or a dollar of potential profit forgone); the gullibility that makes investors swallow tall tales of profit potential in good times, and the excessive skepticism that makes them reject all possibility of gains in bad times; the fluctuating nature of investors’ risk tolerance and risk aversion, and thus of their demands for compensatory risk premiums; the herd behavior that results from pressure to fall into line with what others are doing, and as a result the difficulty of holding non-conformist positions; the extreme discomfort that comes from watching others make money doing something you’ve rejected; thus the tendency of investors who have resisted an asset bubble to ultimately succumb to the pressure, throw in the towel and buy (even though—no, because—the asset that is the subject of the bubble has appreciated substantially); the corresponding tendency to give up on investments that are unpopular and unsuccessful, no matter how intellectually sound, and finally, the fact that investing is all about money, which introduces powerful elements such as greed for more, envy of the money others are making, and fear of loss.

The key principal is that it is only possible to have fixed interest payments if the current market price fluctuates (e.g., bond funds), and that it is only possible to have fixed share price if the current interest rate moves with the market (e.g., money market funds).

As we see it, a single man-made stock-market crash, a single computer virus invasion, or a single rumor or scandal that results in a fluctuation in the enemy country’s exchange rates or exposes the leaders of an enemy country on the Internet, all can be included in the ranks of new-concept weapons.

The longer I’m involved in investing, the more impressed I am by the power of the credit cycle. It takes only a small fluctuation in the economy to produce a large fluctuation in the availability of credit, with great impact on asset prices and back on the economy itself.

It’s time for another aside: If you look at the last two tables—those showing big losses in 2008 and big gains in 2009—it’s easy to conclude that the two years together were something of a non-event. For example, if you put $100 into the Credit Suisse Leveraged Loan Index on the first day of 2008, you would have lost 29% over the course of the year and had only $71 left at the end. But then you would have gained 45% in 2009 and ended up with $103 at the conclusion of the two-year period, for a net gain of $3. The two-year results in the asset classes listed above ranged from moderate net losses to moderate net gains. It matters enormously, however, what you did in between. Yes, holding on would have enabled you to recoup most or all of your losses and end up well, with results as described above. But if you lost your nerve and sold at the trough—or if, having bought with borrowed money, you received a margin call you couldn’t meet and saw your positions sold out from under you—you experienced the decline but not the recovery, and your net result in this “non-event” two-year period was disastrous. For this reason, it’s important to note that exiting the market after a decline—and thus failing to participate in a cyclical rebound—is truly the cardinal sin in investing. Experiencing a mark-to-market loss in the downward phase of a cycle isn’t fatal in and of itself, as long as you hold through the beneficial upward part as well. It’s converting that downward fluctuation into a permanent loss by selling out at the bottom that’s really terrible. Thus understanding cycles and having the emotional and financial wherewithal needed to live through them are essential ingredients in investment success.

The investor with a portfolio of sound stocks should expect their prices to fluctuate and should neither be concerned by sizable declines nor become excited by sizable advances. He should always remember that market quotations are there for his convenience, either to be taken advantage of or to be ignored. He should never buy a stock because it has gone up or sell one because it has gone down. He would not be far wrong if this motto read more simply: “Never buy a stock immediately after a substantial rise or sell one immediately after a substantial drop.

The fact is that the performance of these things is heavily influenced in the short run by, among other things, the involvement of people, and people are far from steady. Rather they fluctuate from time to time, often because of things we can lump under the broad heading of “psychology.” Thus people’s behavior varies … certainly as the environment varies, but sometimes in the absence of changes in the environment, too.

On another project the best engineering manager I ever saw served often as a giant flywheel, his inertia damping the fluctuations that came from market and management people.

As you can see, the rise and fall of opportunities in the market for distressed debt stems from the interaction of other cycles: in the economy, investor psychology, risk attitudes and the credit market. The economic cycle influences investor psychology, company profitability and the incidence of default. The cycle in psychology contributes to fluctuations in credit market conditions and the desire of investors to lend, buy and sell. The cycle in attitudes toward risk facilitates the issuance of weak bonds at the top and denies capital for refinancing at the bottom. The credit cycle has a profound effect on the availability of refinancing and the degree to which would-be debt issuers are subjected to stringent credit standards. Hopefully it’s clear that multiple underlying cycles have effects on the distressed debt market that are far from discrete and isolated. As I wrote earlier, each of these cycles rises and falls; each causes the others to rise and fall; and each is affected by the rise and fall of others. But the result of all of this is a dramatic cycle in distressed debt opportunities, and one that is subject to explanation.

the way investors fluctuate rather than hold firmly to rational thinking and the resulting rational decisions; the tendency of investors to hold distorted views of what’s going on, engaging in selective perception and skewed interpretation; quirks like confirmation bias, which makes people accept evidence that confirms their thesis and reject that which doesn’t, and the tendency toward non-linear utility, which causes most people to value a dollar lost more highly than a dollar made (or a dollar of potential profit forgone); the gullibility that makes investors swallow tall tales of profit potential in good times, and the excessive skepticism that makes them reject all possibility of gains in bad times; the fluctuating nature of investors’ risk tolerance and risk aversion, and thus of their demands for compensatory risk premiums; the herd behavior that results from pressure to fall into line with what others are doing, and as a result the difficulty of holding non-conformist positions; the extreme discomfort that comes from watching others make money doing something you’ve rejected; thus the tendency of investors who have resisted an asset bubble to ultimately succumb to the pressure, throw in the towel and buy (even though — no, because — the asset that is the subject of the bubble has appreciated substantially); the corresponding tendency to give up on investments that are unpopular and unsuccessful, no matter how intellectually sound, and finally, the fact that investing is all about money, which introduces powerful elements such as greed for more, envy of the money others are making, and fear of loss.

Yet the idea that there exists an order behind the seemingly diverse phenomena of the turbulent flow of water and clouds, of the striations in the bark of a tree as well as the fluctuations in the stock market is what is now called “deterministic chaos.” Leibniz no doubt apprehended in the Chinese concept of li a principle that could stand for the sort of complex preestablished harmony he saw as systematically ordering his universe of monads. That this natural order is so complex that it mirrors the complexities of organisms rather than machines is an idea that Needham apprehends as being the leitmotif of the “philosophy of organism” as first promoted by Leibniz.

Three important impediments to a unified European market were a plethora of rules and regulations that differed across countries, impediments to the movement of firms and labor across countries, and currency fluctuation. In a series of negotiated agreements, starting with the Single European Act in 1986, the Maastricht Treaty in 1991, and the Treaty of Amsterdam in 1997, much of Europe agreed to merge into a Union which would implement the four freedoms—the freedom of movement of goods, services, people, and capital across the borders of the signatories. They agreed to a common European citizenship, over and above national citizenship. In addition, a subset of the countries decided to adopt a common currency, the euro.

But insurance is nothing more than a name we give to risk-pooling arrangements that are organized through private markets. When these markets fail, it is possible to pool risks in other ways. The corporation provides a perfect example of how people can arrange to share risks without the mediation of explicit market mechanisms. For example, there are many types of production processes that call for very specialized skills. The division of labour is itself an enormous source of efficiency gains. Unfortunately, acquiring highly specialized skills can be extremely risky for an individual, because the future is uncertain. While I may know that there is adequate demand for my skills now, I have no idea what things will be like five years down the road. As a result, no one may be willing to invest the time and energy needed to acquire specialized skills, because it is too risky. This efficiency loss could be avoided if it were possible to buy some kind of insurance that would compensate people when there was some fluctuation in the demand for their skills. Unfortunately, no one would ever want to sell this type of insurance because of obvious moral-hazard problems—people would lose all incentive to market or upgrade their skills. So private markets will simply fail to provide this type of insurance. Corporations, however, are able to provide such insurance to workers through bureaucratic means.

With that said, if you were to be a long-term investor in Ethereum, you have to focus on the long-term timeline, with short-term volatility being a necessary even to find traction within the market, and for value to solidify. Thus, if you believe that the demand for Ethereum will be higher in one, two, five, or ten years (your duration in which you plan to hold), then you need not worry about the fluctuations that occur in the interim. Let’s

Simple accident: a zombie-crewed containership from Southern Kath wrecked in a storm. The containership had been hired to transport a horror from beyond the stars, but the horror broke free and twisted a few hundred miles of Kathic coastline into unearthly geometries before the Coast Guard caught it. Resulting market fluctuations broke the Great Squid. Steve, the priest responsible, was promoted after the event, for exceptional skill managing a crisis,

In proportion as the bourgeoisie, i.e., capital, is developed, in the same proportion is the proletariat, the modern working class, developed—a class of labourers, who live only so long as they find work, and who find work only so long as their labour increases capital. These labourers, who must sell themselves piece-meal, are a commodity, like every other article of commerce, and are consequently exposed to all the vicissitudes of competition, to all the fluctuations of the market.

Alan Greenspan needs to create a housing bubble to replace the Nasdaq bubble,” cried New York Times columnist Paul Krugman in 2002.8 And that’s exactly what Greenspan did. Much of the new cash that flooded into the market as a result of his policies went into real estate, where small fluctuations in interest rates have a huge impact on prices.

Keynes had been appointed to the board of the National Mutual, one of the oldest institutions in the city, in 1919.107 He had served as chairman of the insurer, and helped manage its investment portfolio from 1921. That portfolio lost £641,000 ($61 million), an enormous sum of money in 1937. While Keynes was recuperating from a heart attack, F. N. Curzon, the acting chairman of the insurer called him to account for the loss.108 Curzon and the board criticized Keynes’s investment policy of remaining invested in his “pet” stocks during the decline.109 In a response to Curzon in March 1938, Keynes wrote:110 1. I do not believe that selling at very low prices is a remedy for having failed to sell at high ones. . . . As soon as prices had fallen below a reasonable estimate of intrinsic value and long-period probabilities, there was nothing more to be done. It was too late to remedy any defects in previous policy, and the right course was to stand pretty well where one was. 2. I feel no shame at being found owning a share when the bottom of the market comes. I do not think it is the business, far less the duty, for an institutional or any other serious investor to be constantly considering whether he should cut and run on a falling market, or to feel himself open to blame if shares depreciate on his hands. . . . An investor is aiming, or should be aiming, primarily at long-period results, and should be solely judged by these. . . . The idea that we should all be selling out to the other fellow and should all be finding ourselves with nothing but cash at the bottom of the market is not merely fantastic, but destructive of the whole system. 3. I do not feel that we have in fact done particularly badly. . . . If we deal in equities; it is inevitable that there should be large fluctuations.

Farmers had freed themselves in part from the blind natural forces of storm and insects only to become increasingly the victims of the equally blind forces of market fluctuations. (p. 14)

It’s a common theme among the highly concentrated investors profiled in this book. Permanent capital—capital not subject to withdrawal or redemption—is an essential component for achieving high returns in concentrated portfolios because it offers the luxury of ignoring the short-term fluctuations of the market:65 Why would we want those artificial constraints? Lou had considerable periods in the dotcom bubble when the averages were outperforming Lou. It was years and he got well all at once. Nobody was saying to him, “How can you do this to us for three years running?” The money management business is not necessarily a good way to manage money if you are really trying to maximize your returns over 30 years.

When market prices fall below (rise above) this firm foundation of intrinsic value, a buying (selling) opportunity arises, because this fluctuation will eventually be corrected—or so the theory goes. Investing then becomes a dull but straightforward matter of comparing something’s actual price with its firm foundation of value.

The cards dealt at blackjack also seem to appear at random but not if you “track the shuffle,” which is a way to beat the game by watching the order in which the discarded cards are stacked, then mathematically analyzing the particular shuffling technique being used, leading to a partial prediction of the new ordering of the cards for the next deal. The likelihood of any card being the one that is dealt next is not random if you count the cards. What appears random for one state of knowledge may not be if we are given more information. Future prices are not predictable and no one can beat the market, but only when market prices “truly” fluctuate randomly.

The big three for most investors are equities, interest rate securities, and real estate. Each accounts for about a quarter of the total net worth of US households, though the proportions fluctuate, particularly when an asset class experiences a boom or a bust.

Colonial Policy and Practice: A Comparative Study of Burma and Netherlands India by J. S. Furnivall Quoting page 85-87: Lower Burma when first occupied … was a vast deltaic plain of swamp and jungle, with a secure rainfall; when the opening of the canal created a market for rice, this wide expanse of land was rapidly reclaimed by small cultivators … Formerly, the villager in Lower Burma, like peasants in general, cultivated primarily for home consumption, and it has always been the express policy of the Government to encourage peasant proprietorship. Land in the delta was abundant … The opening of the canal provided a certain and profitable market for as much rice as people could grow. … men from Upper Burma crowded down to join in the scramble for land. In two or three years a labourer could save out of his wages enough money to buy cattle and make a start on a modest scale as a landowner. … The land had to be cleared rapidly and hired labour was needed to fell the heavy jungle. In these circumstances newly reclaimed land did not pay the cost of cultivation, and there was a general demand for capital. Burmans, however, lacked the necessary funds, and had no access to capital. They did not know English or English banking methods, and English bankers knew nothing of Burmans or cultivation. … in the ports there were Indian moneylenders of the chettyar caste, amply provided with capital and long accustomed to dealing with European banks in India. About 1880 they began to send out agents into the villages, and supplied the people with all the necessary capital, usually at reasonable rates and, with some qualifications, on sound business principles. … now the chettyars readily supplied the cultivators with all the money that they needed, and with more than all they needed. On business principles the money lender preferred large transactions, and would advance not merely what the cultivator might require but as much as the security would stand. Naturally, the cultivator took all that he could get, and spent the surplus on imported goods. The working of economic forces pressed money on the cultivator; to his own discomfiture, but to the profit of the moneylenders, of European exporters who could ensure supplies by giving out advances, of European importers whose cotton goods and other wares the cultivator could purchase with the surplus of his borrowings, and of the banks which financed the whole economic structure. But at the first reverse, with any failure of the crop, the death of cattle, the illness of the cultivator, or a fall of prices, due either to fluctuations in world prices or to manipulation of the market by the merchants, the cultivator was sold up, and the land passed to the moneylender, who found some other thrifty labourer to take it, leaving part of the purchase price on mortgage, and with two or three years the process was repeated. … As time went on, the purchasers came more and more to be men who looked to making a livelihood from rent, or who wished to make certain of supplies of paddy for their business. … Others also, merchants and shopkeepers, bought land, because they had no other investment for their profits. These trading classes were mainly townsfolk, and for the most part Indians or Chinese. Thus, there was a steady growth of absentee ownership, with the land passing into the hands of foreigners. Usually, however, as soon as one cultivator went bankrupt, his land was taken over by another cultivator, who in turn lost with two or three years his land and cattle and all that he had saved. [By the 1930s] it appeared that practically half the land in Lower Burma was owned by absentees, and in the chief rice-producing districts from two-thirds to nearly three-quarters. … The policy of conserving a peasant proprietary was of no avail against the hard reality of economic forces…

On 3 timeless ideas for investing Benjamin Graham, three fundamentally basic ideas: 1. You should look at stocks as part of ownership of a business. 2. You should look at market fluctuations in terms of his "Mr. Market" example & make them your friend rather than your enemy by essentially profiting from folly rather participating in it, & finally, 3. The 3 most important words in investing are "margin of safety" - ...always building a 15,000 pound bridge if you're going to be driving 10,000 pound truck across it...

Morgan Stanley offered two key concessions that persuaded S&P to give the new bonds a AA-rating. First, the company would issue two classes of bonds, and S&P would rate only the much safer of the two. Banamex would keep the riskier unrated class of bonds, to serve as a cushion to protect the safer bonds, providing greater assurance that the rated bonds would be repaid in full. The company would also purchase some U.S. Treasury bonds, as additional protection. The safer, rated bonds were the bonds actually called PLUS Notes. Second, Morgan Stanley also agreed that the company would commit in advance to execute a foreign currency transaction in which Morgan Stanley would convert the peso payments on the Ajustabonos into U.S. dollars. S&P must have been suspicious that Morgan Stanley would try to market these new bonds as denominated in U.S. dollars, not pesos. As a compromise, S&P required that Morgan Stanley advertise the new bonds with a caveat. The Offering Memorandum for the bonds had to include a disclaimer: “This rating does not reflect the risk associated with fluctuations in the currency exchange rate between Dollars and New Pesos.” With this warning, and a huge fee, S&P finally was satisfied and agreed to rate the new bonds AA-.

Active investors have a number of options available to them. First, they can decide to make their portfolio more aggressive or more defensive than the index, either on a permanent basis or in an attempt at market timing. If investors choose aggressiveness, for example, they can increase their portfolios’ market sensitivity by overweighting those stocks in the index that typically fluctuate more than the rest, or by utilizing leverage. Doing these things will increase the “systematic” riskiness of a portfolio, its beta. (However, theory says that while this may increase a portfolio’s return, the return differential will be fully explained by the increase in systematic risk borne. Thus doing these things won’t improve the portfolio’s risk-adjusted return.)

Active investors have a number of options available to them. First, they can decide to make their portfolio more aggressive or more defensive than the index, either on a permanent basis or in an attempt at market timing. If investors choose aggressiveness, for example, they can increase their portfolios’ market sensitivity by overweighting those stocks in the index that typically fluctuate more than the rest, or by utilizing leverage. Doing these things will increase the “systematic” riskiness of a portfolio, its beta. (However, theory says that while this may increase a portfolio’s return, the return differential will be fully explained by the increase in systematic risk borne. Thus doing these things won’t improve the portfolio’s risk-adjusted return.) Second, investors can decide to deviate from the index in order to exploit their stock-picking ability—buying more of some stocks in the index, underweighting or excluding others, and adding some stocks that aren’t part of the index. In doing so they will alter the exposure of their portfolios to specific events that occur at individual companies, and thus to price movements that affect only certain stocks, not the whole index. As the composition of their portfolios diverges from the index for “nonsystematic” (we might say “idiosyncratic”) reasons, their return will deviate as well. In the long run, however, unless the investors have superior insight, these deviations will cancel out, and their risk-adjusted performance will converge with that of the index.

Look at stocks as part ownership of a business. 2. Look at Mr. Market—volatile stock price fluctuations—as your friend rather than your enemy. View risk as the possibility of permanent loss of purchasing power, and uncertainty as the unpredictability regarding the degree of variability in the possible range of outcomes. 3. Remember the three most important words in investing: “margin of safety.” 4. Evaluate any news item or event only in terms of its impact on (a) future interest rates and (b) the intrinsic value of the business, which is the discounted value of the cash that can be taken out during its remaining life, adjusted for the uncertainty around receiving those cash flows. 5. Think in terms of opportunity costs when evaluating new ideas and keep a very high hurdle rate for incoming investments. Be unreasonable. When you look at a business and get a strong desire from within saying, “I wish I owned this business,” that is the kind of business in which you should be investing. A great investment idea doesn’t need hours to analyze. More often than not, it is love at first sight. 6. Think probabilistically rather than deterministically, because the future is never certain and it is really a set of branching probability streams. At the same time, avoid the risk of ruin, when making decisions, by focusing on consequences rather than just on raw probabilities in isolation. Some risks are just not worth taking, whatever the potential upside may be. 7. Never underestimate the power of incentives in any given situation. 8. When making decisions, involve both the left side of your brain (logic, analysis, and math) and the right side (intuition, creativity, and emotions). 9. Engage in visual thinking, which helps us to better understand complex information, organize our thoughts, and improve our ability to think and communicate. 10. Invert, always invert. You can avoid a lot of pain by visualizing your life after you have lost a lot of money trading or speculating using derivatives or leverage. If the visuals unnerve you, don’t do anything that could get you remotely close to reaching such a situation. 11. Vicariously learn from others throughout life. Embrace everlasting humility to succeed in this endeavor. 12. Embrace the power of long-term compounding. All the great things in life come from compound interest.

In the realm of financial markets, volatility is an inherent characteristic. Prices of stocks, commodities, and other securities can experience significant fluctuations within short periods. To manage such volatility and protect the interests of investors, circuit breakers are implemented. These circuit breakers impose upper and lower limits on price movements, which temporarily halt trading. In this blog post, we will explore the concept of upper and lower circuit limits, their purpose, and how they impact the functioning of financial markets. Defining Upper and Lower Circuit Limits Upper and lower circuit limits are predetermined price thresholds that trigger temporary trading halts. These limits are set by exchanges or regulatory bodies to prevent extreme price movements and provide stability to the market. When the price of a security reaches or breaches the upper or lower circuit limit, trading is paused for a specified period. This allows market participants to reevaluate their positions and absorb the information driving the price volatility. The Purpose of Circuit Breakers: The primary objective of circuit breakers is to safeguard the financial markets from excessive price volatility and potential panic selling or buying. These mechanisms help prevent extreme price movements that could be detrimental to market stability and investor confidence. By temporarily halting trading, circuit breakers provide a cooling-off period, allowing participants to assess new information and avoid making impulsive decisions. Moreover, circuit breakers ensure orderly trading and prevent the market from being dominated by high-frequency trading strategies that thrive on short-term price fluctuations. They offer investors an opportunity to reassess their strategies and risk exposure, reducing the likelihood of knee-jerk reactions based on short-term market movements. Understanding the Upper Circuit Limit : The upper circuit limit represents the maximum price movement permitted for security within a trading session. When the price of a security reaches or surpasses the upper circuit limit, trading in that security is halted. The upper circuit limit aims to prevent excessive speculative buying and provides a pause for market participants to analyze the new information or demand driving the price surge. During the trading halt, market participants can evaluate the situation, adjust their strategies, and determine whether to buy, sell, or hold the security when trading resumes. The duration of the halt varies depending on the exchange or regulatory body and is typically predetermined. Understanding the Lower Circuit Limit: Conversely, the lower circuit limit represents the minimum price movement allowed for security. When the price of a security falls to or breaches the lower circuit limit, trading is halted. The lower circuit limit is designed to prevent panic selling and provides market participants with an opportunity to reassess their positions. Similar to the upper circuit limit, the duration of the trading halt triggered by a lower circuit limit breach is typically predetermined. During this time, investors can evaluate the reasons behind the price decline, analyze market conditions, and make informed decisions. Impact of Circuit Breakers on Financial Markets: Circuit breakers play a crucial role in maintaining market stability, particularly during periods of heightened volatility and uncertainty. By temporarily halting trading, they allow time for market participants to process new information, reassess their positions, and avoid making impulsive decisions based on short-term price movements. Circuit breakers also facilitate the restoration of liquidity in the market. When trading is halted, market makers and other participants have an opportunity to recalibrate their pricing and liquidity provision strategies, which can help smooth out price discrepancies and enhance market efficiency.

To apply first principles thinking to the field of value investing, consider several fundamental truths. Understand and practice the following if you want to become a good investor: 1. Look at stocks as part ownership of a business. 2. Look at Mr. Market—volatile stock price fluctuations—as your friend rather than your enemy. View risk as the possibility of permanent loss of purchasing power, and uncertainty as the unpredictability regarding the degree of variability in the possible range of outcomes. 3. Remember the three most important words in investing: “margin of safety.” 4. Evaluate any news item or event only in terms of its impact on (a) future interest rates and (b) the intrinsic value of the business, which is the discounted value of the cash that can be taken out during its remaining life, adjusted for the uncertainty around receiving those cash flows. 5. Think in terms of opportunity costs when evaluating new ideas and keep a very high hurdle rate for incoming investments. Be unreasonable. When you look at a business and get a strong desire from within saying, “I wish I owned this business,” that is the kind of business in which you should be investing. A great investment idea doesn’t need hours to analyze. More often than not, it is love at first sight. 6. Think probabilistically rather than deterministically, because the future is never certain and it is really a set of branching probability streams. At the same time, avoid the risk of ruin, when making decisions, by focusing on consequences rather than just on raw probabilities in isolation. Some risks are just not worth taking, whatever the potential upside may be. 7. Never underestimate the power of incentives in any given situation. 8. When making decisions, involve both the left side of your brain (logic, analysis, and math) and the right side (intuition, creativity, and emotions). 9. Engage in visual thinking, which helps us to better understand complex information, organize our thoughts, and improve our ability to think and communicate. 10. Invert, always invert. You can avoid a lot of pain by visualizing your life after you have lost a lot of money trading or speculating using derivatives or leverage. If the visuals unnerve you, don’t do anything that could get you remotely close to reaching such a situation. 11. Vicariously learn from others throughout life. Embrace everlasting humility to succeed in this endeavor. 12. Embrace the power of long-term compounding. All the great things in life come from compound interest.

There are very few groups left who, like doctors and psychotherapists and some farmers, still have the luxury of being their own economic bosses—and even they are subject to the rise and fall of prices and the fluctuating market like everyone else.

1)Insufficient research and knowledge: Many beginners dive into investing without fully understanding the fundamentals or conducting thorough research. It's crucial to educate yourself about different investment options, financial markets, and investment strategies before getting started. 2)Failure to establish clear investment goals: Investing without clear goals can lead to haphazard decision-making and poor portfolio management. Beginners should define their investment objectives, such as saving for retirement, buying a home, or funding education, and then align their investment strategy accordingly. 3)Lack of diversification: Beginners sometimes make the mistake of investing all their money in a single investment or asset class. This lack of diversification can expose them to significant risks. It's important to spread investments across different asset classes, industries, and geographies to reduce the impact of any individual investment's performance on the overall portfolio. 4)Emotion-driven decision-making: Emotions can often cloud investment decisions. Beginners may get swayed by market hype, fear, or short-term fluctuations, leading to impulsive buying or selling. It's essential to make investment decisions based on rational analysis and a long-term perspective rather than reacting to short-term market movements. 5)Chasing quick profits: Beginner investors may be tempted by get-rich-quick schemes or investments promising high returns in a short period. Such investments often involve higher risks, and pursuing quick profits can lead to significant losses. It's important to have realistic return expectations and focus on long-term, sustainable investment strategies.

Death, inheritance, forfeiture, escheat, vassals’ changing lords, partition of fiefs, subinfeudation, union of fiefs by marriage, conquests in war – all these changes kept the feudal world in almost as fluctuating a condition as the modern stock market.

In proportion as the bourgeoisie, i.e., capital, is developed, in the same proportion is the proletariat, the modern working class, developed; a class of laborers, who live only so long as they find work, and who find work only so long as their labor increases capital. These laborers, who must sell themselves piecemeal, are a commodity, like every other article of commerce, and are consequently exposed to all the vicissitudes of competition, to all the fluctuations of the market.

Before we explore the account setup, let's take a closer look at how Immediate Momentum functions. Understanding the mechanics of this trading software is crucial to comprehend its potential benefits. According to Immediate Momentum's official website, the software harnesses sophisticated algorithms to analyze cryptocurrency price movements with pinpoint accuracy. It relies on technical indicators and historical data to identify lucrative trading opportunities by monitoring market trends. Immediate Momentum review operates fully automatically, executing every action on behalf of traders. Users have the flexibility to fine-tune trade parameters to align with their risk tolerance, investment objectives, and experience level. This customization empowers the software to analyze market trends and generate precise trade signals. Immediate Momentum continually assesses price fluctuations, notifying users of any significant value changes in the cryptocurrencies they're trading. All it takes is twenty minutes to set up the software's parameters, after which it takes over the trading process with efficiency.

The stocks that had gone up the most did worse as a group than the market in the next few weeks, and the stocks that were the most down did better. Historically, the annualized return was 20 percent from buying the one-tenth of stocks that had fallen most and selling short the tenth that had risen most. We called the system MUD, as it was constructed from the “most-up, most-down” stocks. As UCI mathematician William F. Donoghue would joke, “Thorp, my advice is to buy low and sell high.” The portfolio of long stocks tracked the market and the short portfolio did the opposite, so the two sides together mostly canceled the movement of the market. This gave us what we liked, a market-neutral portfolio. But that portfolio still had larger fluctuations in value than our usual investments, so we put statistical arbitrage aside for the time being.

What appears random for one state of knowledge may not be if we are given more information. Future prices are not predictable and no one can beat the market, but only when market prices “truly” fluctuate randomly.

The platform is a simple-sounding yet transformative concept that is radically changing business, the economy, and society at large. As we’ll explain, practically any industry in which information is an important ingredient is a candidate for the platform revolution. That includes businesses whose “product” is information (like education and media) but also any business where access to information about customer needs, price fluctuations, supply and demand, and market trends has value—which includes almost every business.

A Moment of Joy" The ruling global elites are holding their breath in anticipation of who may be the first to start a nuclear war! The wealthy and the stock market traders are fearfully watching the fluctuation in the stock prices… Writers, media pundits, and academics on the payroll of power and authority are worried about a potential revolution that may put an end to the powers in place, and consequently to their existence! Doctors, engineers, and other professionals are all alarmed and watching the job market in fear of losing their cushy jobs! Only the waitress at the nearby restaurant is experiencing a moment of joy for the generous tip she just received from the last customer tonight! [Original poem published in Arabic on October 30,2023 at ahewar.org]

Keeping track of the 5s leads to a very simple winning system. Suppose the player bets small whenever any 5s are left and bets big whenever all the 5s are gone. The likelihood of all the 5s being gone increases as fewer cards remain. When twenty-six cards are left, this will happen about 5 percent of the time, and if only thirteen cards are left, 30 percent of the time. Since the player then has a 3.29 percent edge on his bets, if these are very big compared with his other bets he wins in the long run. For actual casino play, I built a much more powerful winning strategy based on the fluctuation in the percentage of Ten-value cards in the deck, even though my calculations showed that the impact of a Ten was less than that of a 5, since there were four times as many Tens. The larger fluctuations in “Ten-richness” that resulted gave the player more and better opportunities.

Since the prices of the two securities tended to move together, the important idea of “hedging” occurred to me, in which I could use this relationship to exploit any mispricing of the warrant and simultaneously reduce the risk of doing so. To form a hedge, take two securities whose prices tend to move together, such as a warrant and the common stock it can be used to purchase, but which are comparatively mispriced. Buy the relatively underpriced security and sell short the relatively overpriced security. If the proportions in the position are chosen well, then even though prices fluctuate, the gains and losses on the two sides will approximately offset or hedge each other. If the relative mispricing between the two securities disappears as expected, close the position in both and collect a profit.

So this bond combines the features of both an ordinary bond and an option. The market price of the bond can be thought of as the sum of two parts. The first is the value of a comparable bond without the conversion feature, which will fluctuate with the level of interest rates and the financial soundness of the company. This sets a “floor” to the price. The second part is the option value of the conversion feature. In our example, if the stock is at $50, the bond can be exchanged for twenty shares of stock, worth $1,000, which the bond is worth anyhow when it matures so there is no benefit from the conversion feature. However, if the stock were to rise at any point to $75, twenty shares of stock would be worth $1,500. The bond, which can be exchanged immediately for this amount of stock, should trade in the market then for at least that amount.

would eventually do so. Blessed with a voice that could make fluctuations on the stock market sound seductive and a delivery that was hypnotically unhurried, it was obvious that Alan had a natural gift for acting.

The long-term increase in the stock market is entirely the result of the increase in long-term dividends and earnings growth of the companies that make up the market. How much investors are willing to pay for those earnings and dividends will change constantly. Much of these fluctuations have to do with speculation, but most of them have to do with the fact that investors are constantly projecting out the recent past into an uncertain future. That doesn't mean the odds are stacked against individual investors; just the ones who are unable to control their emotions.

In concentrated portfolios, market fluctuations are magnified. All market noises look like real events.

Understanding Financial Risks and Companies Mitigate them? Financial risks are the possible threats, losses and debts corporations face during setting up policies and seeking new business opportunities. Financial risks lead to negative implications for the corporations that can lead to loss of financial assets, liabilities and capital. Mitigation of risks and their avoidance in the early stages of product deployment, strategy-planning and other vital phases is top-priority for financial advisors and managers. Here's how to mitigate risks in financial corporates:- ● Keeping track of Business Operations Evaluating existing business operations in the corporations will provide a holistic view of the movement of cash-flows, utilisation of financial assets, and avoiding debts and losses. ● Stocking up Emergency Funds Just as families maintain an emergency fund for dealing with uncertainties, the same goes for large corporates. Coping with uncertainty such as the ongoing pandemic is a valuable lesson that has taught businesses to maintain emergency funds to avoid economic lapses. ● Taking Data-Backed Decisions Senior financial advisors and managers must take well-reformed decisions backed by data insights. Data-based technologies such as data analytics, science, and others provide resourceful insights about various economic activities and help single out the anomalies and avoid risks. Enrolling for a course in finance through a reputed university can help young aspiring financial risk advisors understand different ways of mitigating risks and threats. The IIM risk management course provides meaningful insights into the other risks involved in corporations. What are the Financial Risks Involved in Corporations? Amongst the several roles and responsibilities undertaken by the financial management sector, identifying and analysing the volatile financial risks. Financial risk management is the pinnacle of the financial world and incorporates the following risks:- ● Market Risk Market risk refers to the threats that emerge due to corporational work-flows, operational setup and work-systems. Various financial risks include- an economic recession, interest rate fluctuations, natural calamities and others. Market risks are also known as "systematic risk" and need to be dealt with appropriately. When there are significant changes in market rates, these risks emerge and lead to economic losses. ● Credit Risk Credit risk is amongst the common threats that organisations face in the current financial scenarios. This risk emerges when a corporation provides credit to its borrower, and there are lapses while receiving owned principal and interest. Credit risk arises when a borrower falters to make the payment owed to them. ● Liquidity Risk Liquidity risk crops up when investors, business ventures and large organisations cannot meet their debt compulsions in the short run. Liquidity risk emerges when a particular financial asset, security or economic proposition can't be traded in the market. ● Operational Risk Operational risk arises due to financial losses resulting from employee's mistakes, failures in implementing policies, reforms and other procedures. Key Takeaway The various financial risks discussed above help professionals learn the different risks, threats and losses. Enrolling for a course in finance assists learners understand the different risks. Moreover, pursuing the IIM risk management course can expose professionals to the scope of international financial management in India and other key concepts.

By now, though, it had been a steep learning curve, he was fairly well versed on the basics of how clearing worked: When a customer bought shares in a stock on Robinhood — say, GameStop — at a specific price, the order was first sent to Robinhood's in-house clearing brokerage, who in turn bundled the trade to a market maker for execution. The trade was then brought to a clearinghouse, who oversaw the trade all the way to the settlement. During this time period, the trade itself needed to be 'insured' against anything that might go wrong, such as some sort of systemic collapse or a default by either party — although in reality, in regulated markets, this seemed extremely unlikely. While the customer's money was temporarily put aside, essentially in an untouchable safe, for the two days it took for the clearing agency to verify that both parties were able to provide what they had agreed upon — the brokerage house, Robinhood — had to insure the deal with a deposit; money of its own, separate from the money that the customer had provided, that could be used to guarantee the value of the trade. In financial parlance, this 'collateral' was known as VAR — or value at risk. For a single trade of a simple asset, it would have been relatively easy to know how much the brokerage would need to deposit to insure the situation; the risk of something going wrong would be small, and the total value would be simple to calculate. If GME was trading at $400 a share and a customer wanted ten shares, there was $4000 at risk, plus or minus some nominal amount due to minute vagaries in market fluctuations during the two-day period before settlement. In such a simple situation, Robinhood might be asked to put up $4000 and change — in addition to the $4000 of the customer's buy order, which remained locked in the safe. The deposit requirement calculation grew more complicated as layers were added onto the trading situation. A single trade had low inherent risk; multiplied to millions of trades, the risk profile began to change. The more volatile the stock — in price and/or volume — the riskier a buy or sell became. Of course, the NSCC did not make these calculations by hand; they used sophisticated algorithms to digest the numerous inputs coming in from the trade — type of equity, volume, current volatility, where it fit into a brokerage's portfolio as a whole — and spit out a 'recommendation' of what sort of deposit would protect the trade. And this process was entirely automated; the brokerage house would continually run its trading activity through the federal clearing system and would receive its updated deposit requirements as often as every fifteen minutes while the market was open. Premarket during a trading week, that number would come in at 5:11 a.m. East Coast time, usually right as Jim, in Orlando, was finishing his morning coffee. Robinhood would then have until 10:00 a.m. to satisfy the deposit requirement for the upcoming day of trading — or risk being in default, which could lead to an immediate shutdown of all operations. Usually, the deposit requirement was tied closely to the actual dollars being 'spent' on the trades; a near equal number of buys and sells in a brokerage house's trading profile lowered its overall risk, and though volatility was common, especially in the past half-decade, even a two-day settlement period came with an acceptable level of confidence that nobody would fail to deliver on their trades.

Pages 85-87: Lower Burma when first occupied … was a vast deltaic plain of swamp and jungle, with a secure rainfall; when the opening of the canal created a market for rice, this wide expanse of land was rapidly reclaimed by small cultivators … Formerly, the villager in Lower Burma, like peasants in general, cultivated primarily for home consumption, and it has always been the express policy of the Government to encourage peasant proprietorship. Land in the delta was abundant … The opening of the canal provided a certain and profitable market for as much rice as people could grow. … men from Upper Burma crowded down to join in the scramble for land. In two or three years a laborer could save out of his wages enough money to buy cattle and make a start on a modest scale as a landowner. … The land had to be cleared rapidly and hired labor was needed to fell the heavy jungle. In these circumstances newly reclaimed land did not pay the cost of cultivation, and there was a general demand for capital. Burmans, however, lacked the necessary funds, and had no access to capital. They did not know English or English banking methods, and English bankers knew nothing of Burmans or cultivation. … in the ports there were Indian moneylenders of the chettyar caste, amply provided with capital and long accustomed to dealing with European banks in India. About 1880 they began to send out agents into the villages, and supplied the people with all the necessary capital, usually at reasonable rates and, with some qualifications, on sound business principles. … now the chettyars readily supplied the cultivators with all the money that they needed, and with more than all they needed. On business principles the money lender preferred large transactions, and would advance not merely what the cultivator might require but as much as the security would stand. Naturally, the cultivator took all that he could get, and spent the surplus on imported goods. The working of economic forces pressed money on the cultivator; to his own discomfiture, but to the profit of the moneylenders, of European exporters who could ensure supplies by giving out advances, of European importers whose cotton goods and other wares the cultivator could purchase with the surplus of his borrowings, and of the banks which financed the whole economic structure. But at the first reverse, with any failure of the crop, the death of cattle, the illness of the cultivator, or a fall of prices, due either to fluctuations in world prices or to manipulation of the market by the merchants, the cultivator was sold up, and the land passed to the moneylender, who found some other thrifty laborer to take it, leaving part of the purchase price on mortgage, and with two or three years the process was repeated. … As time went on, the purchasers came more and more to be men who looked to making a livelihood from rent, or who wished to make certain of supplies of paddy for their business. … Others also, merchants and shopkeepers, bought land, because they had no other investment for their profits. These trading classes were mainly townsfolk, and for the most part Indians or Chinese. Thus, there was a steady growth of absentee ownership, with the land passing into the hands of foreigners. Usually, however, as soon as one cultivator went bankrupt, his land was taken over by another cultivator, who in turn lost with two or three years his land and cattle and all that he had saved. [By the 1930s] it appeared that practically half the land in Lower Burma was owned by absentees, and in the chief rice-producing districts from two-thirds to nearly three-quarters. … The policy of conserving a peasant proprietary was of no avail against the hard reality of economic forces…

Investors with a long-term perspective understand that short-term market fluctuations and noise can often overshadow the true value and growth potential of an investment. By focusing on the long-term horizon, investors can identify opportunities that may not be immediately apparent and position themselves to benefit from significant growth over time.

The same is done with stocks. Frequently, my broker calls and recommends I move a sizable amount of money into the stock of a company that he feels is just about to make a move that will add value to the stock, like announcing a new product. I will move my money in for a week to a month while the stock moves up. Then I pull my initial dollar amount out, and stop worrying about the fluctuations of the market, because my initial money is back and ready to work on another asset. So my money goes in, and then it comes out, and I own an asset that was technically free.

day-to-day fluctuations in the profits of existing investments, which are obviously of an ephemeral and nonsignificant character, tend to have an altogether excessive, and even an absurd, influence on the market.”12

Dictionaries are well respected, and they’re immune to market fluctuations.

Dictionaries are well respected, and they’re immune to market fluctuations. Isn’t there anyone with the balls to aim high and think long-term? “Forget