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Bubble Trouble: Laying Out Inconvenient Truths About How Business and Financial Markets Really Work
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Why Stocks Get Whacked
Manage episode 455817499 series 2987036
When markets get fooled, stocks get …well, WHACKED, to quote a famous Kramerism. Our audience deserves to know more about volatility - for all the PhDs, MBAs and CFAs working on Wall Street, for all the compliance rules and regulations, why is it that a stock can go from hero to zero so quickly? Why is stability in itself destabilizing? [Repeat from May, 2024]
For more on Bubble Trouble, including transcripts of the show, visit us online at http://bubbletroublepodcast.com
You can learn more about Richard at https://www.linkedin.com/in/richard-kramer-16306b2/
More on Will Page at: https://pivotaleconomics.com
(Times below correspond to the episode without considering any inserted advertisements.)
Understanding Market Volatility: The Seven Deadly Sins That Get Stocks Whacked
In this episode of Bubble Trouble, hosted by independent analyst Richard Kramer and economist Will Page, the duo delves into the intricacies of stock market volatility and the factors that lead to significant drops in stock values, often referred to as getting 'whacked.' They explore why financial markets remain volatile despite compliance rules and thorough analysis by Wall Street's experts. Using recent examples like Duolingo and Double Verify, they highlight how sentiment, market expectations, and artificial intelligence fears influence stock performance. They introduce the concept of the seven deadly sins—ranging from expectations management to fake it till you make it—that companies and analysts commit, causing stocks to tank. The discussion covers essential themes like the role of credibility, influence of peer performance, external market factors, and the impact of fear and greed. They also touch on larger market dynamics, such as the dominance of tech giants and the influence of algorithmic trading. The episode is both an educational dive into market mechanics and a cautionary tale for investors, emphasizing the importance of understanding broader market sentiments and the potential pitfalls of speculative trading.
00:00 Introduction
01:18 Part One
02:30 Recent Examples of Stocks Getting Whacked
06:08 The Role of Expectations in Market Behavior
10:53 Credibility and Its Impact on Stocks
16:17 The Influence of Peer Groups and Market Share
18:19 Mathematical Models and Black Swans
23:09 Part Two
24:15 The Sheer Size of Companies and Market Impact
25:13 Big Companies and Revenue Growth Challenges
26:33 Market Dynamics and Money Managers
27:04 Thought Experiment: Market Crowding
28:53 Taxing Market Capitalization
34:18 Fear and Greed in Financial Markets
40:11 Unprofitable IPOs and Market Distortions
42:47 Seven Deadly Sins of Stock Trading
46:22 Conclusion and Final Thoughts
46:53 Credits
Hosted on Acast. See acast.com/privacy for more information.
180 jaksoa
Why Stocks Get Whacked
Bubble Trouble: Laying Out Inconvenient Truths About How Business and Financial Markets Really Work
Manage episode 455817499 series 2987036
When markets get fooled, stocks get …well, WHACKED, to quote a famous Kramerism. Our audience deserves to know more about volatility - for all the PhDs, MBAs and CFAs working on Wall Street, for all the compliance rules and regulations, why is it that a stock can go from hero to zero so quickly? Why is stability in itself destabilizing? [Repeat from May, 2024]
For more on Bubble Trouble, including transcripts of the show, visit us online at http://bubbletroublepodcast.com
You can learn more about Richard at https://www.linkedin.com/in/richard-kramer-16306b2/
More on Will Page at: https://pivotaleconomics.com
(Times below correspond to the episode without considering any inserted advertisements.)
Understanding Market Volatility: The Seven Deadly Sins That Get Stocks Whacked
In this episode of Bubble Trouble, hosted by independent analyst Richard Kramer and economist Will Page, the duo delves into the intricacies of stock market volatility and the factors that lead to significant drops in stock values, often referred to as getting 'whacked.' They explore why financial markets remain volatile despite compliance rules and thorough analysis by Wall Street's experts. Using recent examples like Duolingo and Double Verify, they highlight how sentiment, market expectations, and artificial intelligence fears influence stock performance. They introduce the concept of the seven deadly sins—ranging from expectations management to fake it till you make it—that companies and analysts commit, causing stocks to tank. The discussion covers essential themes like the role of credibility, influence of peer performance, external market factors, and the impact of fear and greed. They also touch on larger market dynamics, such as the dominance of tech giants and the influence of algorithmic trading. The episode is both an educational dive into market mechanics and a cautionary tale for investors, emphasizing the importance of understanding broader market sentiments and the potential pitfalls of speculative trading.
00:00 Introduction
01:18 Part One
02:30 Recent Examples of Stocks Getting Whacked
06:08 The Role of Expectations in Market Behavior
10:53 Credibility and Its Impact on Stocks
16:17 The Influence of Peer Groups and Market Share
18:19 Mathematical Models and Black Swans
23:09 Part Two
24:15 The Sheer Size of Companies and Market Impact
25:13 Big Companies and Revenue Growth Challenges
26:33 Market Dynamics and Money Managers
27:04 Thought Experiment: Market Crowding
28:53 Taxing Market Capitalization
34:18 Fear and Greed in Financial Markets
40:11 Unprofitable IPOs and Market Distortions
42:47 Seven Deadly Sins of Stock Trading
46:22 Conclusion and Final Thoughts
46:53 Credits
Hosted on Acast. See acast.com/privacy for more information.
180 jaksoa
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