

Econophysicist Predicts Date of Chinese Stock Market Collapse (Next Week) - Anon84
http://www.technologyreview.com/blog/arxiv/23839/

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biohacker42
I predict the Shanghai Composite Index will NOT burst between the 17th and
27th July. If my prediction is correct I will happily predict lottery numbers
for anyone who asks.

~~~
henning
I predict there is a 50% chance you are either right or wrong.

~~~
jrandom
I predict there is a 100% chance that he is either right or wrong.

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paraschopra
Such kind of predictions have a funny impact. Imagine if people start
believing the prediction 100%, they would start selling out or short the
market. And those actions collectively would result in a crash.

~~~
christopherolah
Perhaps that's what he intends... Maybe the reason he isn't giving the reason
he is predicting the collapse is because the reason is to see what effect his
prediction has on the market.

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Robin_Message
The article says economics (well, graphs of stock prices) are scale free. Is
this true? Seems hard to prove, can anyone point to any research?

~~~
jk4930
I have some books on complex networks and some on computational finance, it's
common knowledge that such graphs are scale invariant (and not hard to show,
because you just measure relations of ups and downs and volatility a.s.o.and
see that they are independent from the absolute numbers on the graph scale).
Many people like the works of Benoit Mandelbrot on fractals in finance. Google
these keywords.

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Anon84
Can you recommend any?

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agbell
[http://www.amazon.com/Mis-behavior-Markets-Benoit-
Mandelbrot...](http://www.amazon.com/Mis-behavior-Markets-Benoit-
Mandelbrot/dp/0465043550)

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discojesus
Econophysicist?

Does he study the supply and demand for pendula and inclined planes?

~~~
adw
Econophysicists, roughly speaking, model economic systems using techniques
from statistical mechanics; not nearly as silly an idea as it might seem at
first blush.

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discojesus
a) 'twas a joke, sir. :)

and b) the _idea_ may not be silly but the name sure is. By this nomenclature,
all current economists should more properly be called "Econostatisticians" or
"Econopsychologists" (to quote Charlie Munger speaking about the silliness of
the term "Behavioral Economics": "If economics isn't behavioral, then what the
hell _is_ it?!?")

No offense meant, of course. I just think it's a bit humorous. He's an
economist who uses methods from physics, that's all - no need to make up a new
name for it (let alone a name that sounds even dopier than the previous name).

~~~
adw
Yeah, sorry about missing the intent of the joke :) I'm cynical enough to
think people'll just take pot-shots at scientists playing outside their
perceived core expertises just on principle. Not that I'm a scientist turned
startupper or anything.

Anyway, it's a pretentious name, but I think it's a bit like "systems biology"
(biology done by physicists). If physicists do it, they like inventing a new
name.

Of course, there's masses of that kind of thing, and I guess I'm a bit more
sensitive to it than most; the research I did when I was still a researcher
could have been called quantum chemistry, solid state physics, materials
science, or what it was _actually_ called (theoretical mineralogy) and still
have been the same damn thing! (Predicting how glass works.)

~~~
Anon84
_"systems biology" (biology done by physicists). If physicists do it, they
like inventing a new name._

Or biophysics, nanobiology, "human dynamics", etc... sexy names make for sexy
media attention (and grants).

<joke> Also, we like to think of it not as "X done by physicists" but rather
"X done _right_ " </joke>

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BearOfNH
There's a total solar eclipse over China on the 22nd, exactly midway between
the forecast dates. Quite a coincidence, if that's what it is.

In any event the prediction is NOT for the market to tank within the quoted
timeframe ... rather that the market will PEAK between 7/17 and 7/27. This
would be followed by a period of weakness possibly leading to a crash. If the
experience of the USA in 1929 and 1987 is any guide, you would look for a
crash low 55 days later (9/15) or possibly 89 days later (10/19).

Then again, maybe not.

