Larry Williams on Market Prediction

LARRY: The randomness. There’s a huge amount of randomness in the stock market and commodity markets, and that’s why you bet small because at any given time, while I may have a market that’s perfectly set up, Greenspan says something and literally in 3 or 4 words can change everybody’s – all the investors, the Commercials’ the public’s – view of the marketplace. Because the markets are uncontrolled, there’s such a high degree of randomness in them, that’s why you’ve got to bet small, because you’re absolutely right. I remember when President Eisenhower had his heart attack and the market just crashed. It came back a little, well, it did come back in almost a couple of days. The same thing in the Kennedy assassination, the market broke real bad. Nobody knew that was going to happen, but a lot of money was lost. The crash of 1987 was a 3 or 4 day event, but it wiped out billions and billions of dollars. So, you have to have your protection against those excess moves in the marketplace that I think are totally unpredictable. And like you said, I’ve been doing this for 45 years. I’ve seen everybody try to predict the market and nobody – and I’ll underscore, nobody – has ever been able to correctly predict the market for very long. Maybe they’ll get lucky. I’ve gotten lucky a couple of times – called a high and a low –  but can I do it successfully all the time? Nobody does it. Nobody’s ever done it. So you’re going to have losses. You got to protect yourself from that. [34:40]

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