Monday, February 11, 2008

Book Review: Why Stock Markets Crash: Critical Events in Complex Financial Systems. Didier Sornette, Princeton University Press, Princeton, 2003.

Porra, Joseph M. "Why Stock Markets Crash: Critical Events in Complex Financial Systems."
Author- PorrĂ , Josep M. Journal of Statistical Physics; Nov2004, Vol. 117 Issue 3/4. p773-774, 2p.


" The build up of financial bubbles manifest itself as an overal super-exponetial Power-Law acceleratin in the Price Growth Accompanied by long periods of oscillation."

Basically, what he's saying here is bubbbles in the stock market are always the source of a crash in the stock market.

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