QOTD: These people belong to casinos, not to markets.

A cognitive bias that plays a major role in contrarian behavior is a variation of Reactance, i.e., the desire to be different in order to prove something. This has worked well on occasions for some individuals that became famous for predicting crashes but their subsequent predictions failed miserably. However, in the meantime, these individuals enjoyed high positions and large rewards for just being lucky. Unfortunately, our society rewards luck more than skill. This is evident beyond doubt from lottery jackpots. Our society is “lottery-based.” Some in the financial field have realized that and take their chances. But in the case of bears during 2010 and 2011 this did not work out well. They took their chances and did not make it. It is a game: usually when you hear an extraordinary forecast, there is someone behind it who rolls dice in an effort to make it big. These people belong to casinos, not to markets.

- Mike Harris

Hit the jump above to read the whole thing. Mike has these people dead to rights. I know of at least 10 prominent market forecasters and bloggers who are still hanging onto the same bullshit from seven years ago, with disastrous results for the people who’ve been listening to them. They latch onto anything that appears to support a failed call – one week it’s technicals, the next week it’s economic data, then politics, then the Fed, etc.

They need the market to crash to zero in order to have been right at this point.

Imagine someone losing a spin of the roulette wheel and then never leaving the table, poisoning everyone else within earshot about why Red 27 was actually the right call 500 spins ago. GTFO already.