You Can Run But…
Market bubbles are an interesting thing.
They represent the extreme of human emotions.
Even non-bubble markets are fascinating, from a psychological standpoint.
It’s easy to fall into the “logical” trap when looking at stock charts.
Stock charts themselves, separate from what they represent, are a statistician’s fantasy come true.
Short term moving averages, long term moving averages.
The upper and lower bound, based on standard deviations.
The indicators on the bottom, indicating over bought and over sold.
It looks SO technical and specific, that using stock market charts to make money seems, super, super easy.
Every time this red line touches the blue line, jump in.
Every time it crosses the middle line and touches the top line, jump out.
Gaze back a few weeks or months, and you’ll see this happen over and over.
Easy money, right?
Not so fast.
As soon as you have an “open position,” your detached, logical brain takes a back seat.
And your emotions are in high gear.
Every single time the stock ticks up, it’s PROOF you are going to be a millionaire!
Every time it ticks down, it’s PROOF you are going to be homeless!
So, why not create a robotic trading system?
After all, if they can do robot surgery, fly helicopters on Mars, why can’t they write a simple program that will make us rich?
The reason is because stock charts are descriptions of human behavior.
Not just individuals, which CAN be easy to predict.
Imagine a murmuration, a swarm of starlings.
Those birds that kind of swarm around in beautiful but absolutely unpredictable behaviors.
These are simple birds with simple programs.
When they are in a flock, their individual rules are simple.
Stay the same distance from the dudes around you.
Yet each bird with that simple set of rules creates these beautiful yet chaotic patterns.
Now imagine a few hundred thousand people jumping in and out of the hottest stock.
Birds have simple rules.
Humans, not so simple.
Extremely complex mixes of fear and greed and everything in between.
Sure, you can DESCRIBE it, but all those descriptions are based on PREVIOUS behavior.
All The Stars Align
Even more complex are the rare market bubbles that happen periodically.
One of them, the South Sea Bubble that happened back during the 1700’s, causes Isaac Newton to lose a fortune.
Even the super genius creator of calculus couldn’t resist.
What drives stock bubbles?
Warren Buffet said when your idiot neighbor is talking about getting rich, you KNOW it’s a bubble.
This is massive amount of scarcity.
And it also represents something else.
The fear of missing out, or FOMO.
Must. Buy. More.
When FOMO kicks in, even Newton can’t think straight.
Imagine if you could create FOMO for you.
What if you showed up, and people looked at you and thought:
“Damn, I gotta get some of that before it’s too late!”
What would THAT do for your social life?
Mind Persuasion has plenty of books and courses to teach you how to speak hypnotically and persuasively.