It’s a little like the newcomb’s paradox. IMO the “rational” action is the one where given the circumstances you win. At least I’d one box in that problem every time given the way it works. In this example, it’s picking up the $100.
The efficient market hypothesis always confused me since it seems empirically false. Who is making the trades that make the market efficient in the first place? Plus people (even large groups of them) are often wrong. Startups and the massive value they can create are an example of that.
Markets are a prediction of predictions to some extent and people are far from agents that act only on hard numbers (and they’re often not wrong to do so). Markets are probably the best tool we’ve got for this, but they’re far from perfectly efficient.
The efficient market hypothesis always confused me since it seems empirically false. Who is making the trades that make the market efficient in the first place? Plus people (even large groups of them) are often wrong. Startups and the massive value they can create are an example of that.
Markets are a prediction of predictions to some extent and people are far from agents that act only on hard numbers (and they’re often not wrong to do so). Markets are probably the best tool we’ve got for this, but they’re far from perfectly efficient.