Comment Re:Who cares if it kills companies? (Score 1) 109
I agree with almost everthing you wrote
Then why did you write, "There is no level of diversification or foresight that can protect the masses from major bubble collapses"?
I outlined a level of diversification and foresight that *would* protect the masses from major bubble collapses, and demonstrably *has* protected many people from major bubble collapses. You claim it's impossible. Only one of us can be right - either there *is* or there *is not* a way to insulate yourself.
I agree with your strategies for mitigating the risk of bubbles. I disagree that following these strategies has no negative effect on regular investor portfolios. As I said in my post, "while it is possible to mitigate some of the damage, standard investors lose out on a lot of income because of these strategies." If drastic bubbles were not part of a more moderate boom / bust cycle, regular investors with lower risk tolerance could make much more money investing.
That there is some "theoretically possible way to have invested and gotten more money out of the market" ignores the fact that human beings are irrational, jerky, panicked things who do stupid, reckless shit all the time - including investing in ways that create bubbles. Trying to pretend that's not the case, or trying to blame that all on "the investment industry" is stupid.
No one is claiming it is possible to have markets without bubbles. Just like it is not possible to live in a world with no theft or murder. But we can still be upset at the irrational, jerky, panicky investors who create these bubbles, just like we are upset at thieves and murderers. The OP simply said these people tick him off, and my post was backing up that he had something legitimate to be pissed about. Neither of us mentioned any fixes because I doubt either of us think there are any realistic ones.
Eliminating risks come at a cost.
If this is true (which I agree it is) then anyone introducing extra risks into the system (without an equal amount of upside) is creating a negative effect for everyone else. This is basically my entire point.