Fascinating quote regarding some problems in the markets.
“One possibility is that those investing in financial markets expect economic policy to be so dysfunctional that the global economy will remain more or less in its current depressed state for perhaps a decade, or more. The only other explanation is that even now, more than three years after the US financial crisis erupted, financial markets’ ability to price relative risks and returns sensibly has been broken at a deep level, leaving them incapable of doing their job: bearing and managing risk in order to channel savings to entrepreneurial ventures.”
-The Perils of Prophecy, J. Bradford DeLong
I love the alliteration — Delong used “Perils of Prophecy” which works as well as “Folly of Forecast.”