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brendan_r's avatar

Many of the investors who profited from the housing bust copied the ideas and methods (put options on CDOs) of an aspergery nobody named Michael burry (story told well by Michael Lewis in The Big Short; really a tremendous example of what robin is describing). Since burry worked solo, is a poor speaker, and doesn't deal well with people it seems obvious the only reason we know he was the first to generate key insights - and the only reason he benefitted from them - is that he had a market in which to leave a paper trail of obscenely profitable bets.

(And re bartletts point about stopped clocks, burry is anything but. He'd multiplied his small pool of capital exponentially in his first few years as a standard stock picking value investor. His pivot towards a particular negative macro bet was a reluctant one; and his impatient investors almost forced him to abandon it before it enriched them.)

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Overcoming Bias Commenter's avatar

Your idea is contrarian, and so are you. I deny it and distance myself from you.

There is a phenomenon in which someone gains great fame and wealth by holding a radical position; is empirically proved to have been completely wrong; and yet continues to enjoy fame and wealth for continuing to hold the same opinion that was proven to be wrong. George Gilder ("Trust the Internet now more than ever"), Paul Ehrlich (The Population Bomb: Hundreds of millions of people will die of starvation in the 1970s), and Hal Lindsey (The Late Great Planet Earth: Christ will return in the 1970s) come to mind.

If this website used a forum instead of a typepad format, there would be much more incentive to follow up to old topics like this.

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