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by sytelus
3591 days ago
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Good point. Intuitively I think markets would attempt to approximate probability * cost i.e. expected cost. However there is something intensely wrong how market is functioning with environmental issue. It appears that markets is trying to view the expected cost as debt that needs to be paid in future. The value of debt would be much larger in future but markets seems to be ok with current return. This could be a great theoretical hole in efficient markets theory. |
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