What must have been most galling was a simple point Cowels often made that was never answered effectively by the investment advice practioners. As Cowels put it, “Market advice for a fee is a paradox. Anyone who really knew just wouldn’t share his knowledge. Why should he? In five years, he could be the richest man in the world. Why pass the word on?”
In spite of the conclusions he reached, Cowels never doubted that investors would keep buying newsletters. As he put it, “Even if I did my negative surveys every five years, or others continued them when I’m gone, it wouldn’t matter. People are still going to subscribe to these services. They want to believe that somebody really knows. A world in which nobody really knows can be frightening.“
The quote is from Alfred Cowles, the early patron of econometrics. It’s kind of like The Bachelor, people know it’s not really going to work out, but they keep watching just in case there’s a repeat of Trista & Ryan. This book was written in 2001, but a great deal of it will be of interest to those of us who live in 2009 (see this review).