
Careers as Efficient Markets - sfard
http://sfard.posterous.com/careers-as-efficient-markets
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fbnt
In my very humble opinion, what I just read was a lengthy and macchiavellan
explanation of a simple concept: if your co-workers are happy with their job
and you don't, and you all get paid the same, you might want to consider
looking for another job that better fill your expectations.

There's no need for EMH theories and graphs to get that.

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msg
He should take this a step further and talk about BATNA. It explains a lot of
other reasons why you might stay in a crappy job, such as that the job market
is lousy right now. You can also say the job market is not "liquid" right now.

Many people are sitting in local maxima rather than risking their milk money
trying to climb the ladder. The sculptor works at a bank and the banker works
at an antique store because it's not time to follow your dreams just yet...

In IT, the best explanation is here:

[http://thedailywtf.com/Articles/Up-or-Out-Solving-the-IT-
Tur...](http://thedailywtf.com/Articles/Up-or-Out-Solving-the-IT-Turnover-
Crisis.aspx)

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wallflower
"If all you are getting from work is a paycheck, you are underpaid." -Jim Rohn

Someone once explained to me that capitalism is based on overpaying you for
the first few years of your career and underpaying you for the next forty
years.

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chrismealy
I kinda get the point he's making, but the EMH metaphor doesn't work at all.

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joe_the_user
Hmm,

Seems a bit behind the times...

 _Efficient market hypothesis (EMH) is a powerful idea. It started as a way to
explain how prices of tradeable securities will reflect their real value._

Objectively, the efficient market hypothesis was handed it's head in the last
crash. The only "power" in the hypothesis is the "powerful" ability it gives
stock brokers to talk people into putting their 401Ks into some big gambles.

If it doesn't work for a relatively straight-forward market like securities,
it seems doubtful it would for the very opaque and complex labor market.

~~~
yummyfajitas
_Objectively, the efficient market hypothesis was handed it's head in the last
crash._

Interesting. Could you please explain the trading strategy based on market
crashes like the last one which you believe is a counterexample to EMH
(assuming you are not still getting rich with it)?

[http://www.overcomingbias.com/2010/01/how-to-complain-re-
emh...](http://www.overcomingbias.com/2010/01/how-to-complain-re-emh.html)

[edit: clarified what I mean by trading strategy, in response to tome.]

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tome
I'm not sure what you're getting at here. Some investors clearly have made
returns over the last fifty years at substantially above the market rate.

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yummyfajitas
I know, I work for one of them. I certainly would not claim markets are 100%
efficient.

It's joe_the_user's _argument_ that I'm disputing, not his conclusion. In
general, when you make an argument that the EMH is false and certain
securities are priced incorrectly (I'm guessing he is referring to houses or
MBS), you should have a track record of getting rich based on trading those
securities.

~~~
secretasiandan
Does that mean everyone who does not have such a track record should believe
in EMH? Or should they just not make arguments that do anything to contradict
it? Or something else?

~~~
yummyfajitas
In any specific case, you should believe in the EMH. It's the safest
assumption.

And yes, once you are convinced that markets are inefficient, you should not
make any public arguments contradicting the EMH. You should STFU until after
you have earned so much money that you don't care about earning any more [1].

[1] Obviously you can talk to potential investors/employees/etc, keeping in
mind that any one of them might steal your strategy.

