On Jul 29, 2012, at 1:39 PM, Michael Smith wrote:

> On Sun, 29 Jul 2012 13:30:31 -0400
> Doug Henwood <[email protected]> wrote:
> 
>> As theoretical pricing models developed, so did trading. 
> 
> Would the models even have to be any good, or have any 
> sound basis? Wouldn't it be enough that people *thought* 
> they were good?

Good question. As I recall, as the models developed, prices increasingly 
conformed to predictions, because everyone was trading off the same models.

Doug
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