Greenspan on the Daily Show

Alan Greenspan has been making the rounds for his new book, and one stop was to see Jon Stewart last week. At one point during the conversation, he made what I thought was a fascinating statement - that in the last 50 years, he hasn't seen a real improvement in the ability to forecast what the market was going to do. The problem is that people either feel euphoric or fearful, and then make decisions based on emotional states, not on reason.

Anyone who has a solid grasp on marketing could have made the same point, but it sounds different when someone who has spent so many years trying to use mathematics to grasp mass behavior comes out and says so.