Continue reading...“The greatest enemy of knowledge is not ignorance; it is the illusion of knowledge”. Stephen Hawking.
The participants of financial markets are possessed by a need for rational interpretations of reality which they are doomed to contemplate without a chance to change a thing. Something similar happened at the dawn of mankind when fear and weakness in the face of nature found consolation in a Supreme Devine Force suitable for «explaining» anything.
The major problem of rational interpretation of the events happening in the financial markets consists not in its uselessness but in serious material losses it entails. Today we will attempt to reveal the pitfalls laid by rational interpretations using oil futures as an example.
In the summer of 2014 both WTI and Brent grades of crude oil started a free fall causing a global change in the development of world economies. Suffice it to say that as a result of the dramatic oil price depreciation Russian Currency Rouble lost half of its value...
Last edited by a moderator: