Double PhD in Economics & Finance required

It looks like the market is bullish again. Can someone with a double PhD in economics & finance who also holds a CFA, FRM and CPA license, please explain why the market (spy) is not at $350 already?

Bless your heart.

“Three great forces rule the world: stupidity, fear and greed.”

Albert Einstein


Greed is good - G.K

I wonder how we could weigh these variables to explain the market.

SPY % = .30(stupidity) + .60(greed) + .10(fear)

Why are you assuming that the:

  • proper model is linear (e.g., that there are no synergies)
  • weights must add to one


I’m sure he was meaning to imply that a standardized coefficient regression method was employed.

Interesting word choice.

Is it?

It is.

But why?

You’re using “standardized” to mean what is properly known as “affine” (Affine combination - Wikipedia).

It’s interesting because:

  • Regression models need not be linear, and
  • Even when a linear regression model is specified, it’s rare to add the additional constraint that the linear combination be an affine combination (i.e., that the weights or slope coefficients sum to unity)

One might argue, reasonably, that a linear regression model is, somehow, more standard than a nonlinear regression model. I’m not sure that you could find evidence to support the argument that an affine model is more standard than a not-necessarily-affine model.

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You’re so concerned about the affine specifics!

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Guilty as charged.

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I’d honestly work for you.