Extrapolation and bubbles

Extrapolation and Bubbles

We present an extrapolative model of bubbles. In the model, many investors form their demand for a risky asset by weighing two signals—an average of the asset’s past price changes and the asset’s degree of overvaluation. The two signals are in conflict, and investors “waver” over time in the relative weight they put on them. The model predicts that good news about fundamentals can trigger large...

Financial Bubbles, Real Estate bubbles, Derivative Bubbles, and the Financial and Economic Crisis

The financial crisis of 2008, which started with an initially well-defined epicenter focused on mortgage backed securities (MBS), has been cascading into a global economic recession, whose increasing severity and uncertain duration has led and is continuing to lead to massive losses and damage for billions of people. Heavy central bank interventions and government spending programs have been la...

Extrapolation and learning equations

In classical machine learning, regression is treated as a black box process of identifying a suitable function from a hypothesis set without attempting to gain insight into the mechanism connecting inputs and outputs. In the natural sciences, however, finding an interpretable function for a phenomenon is the prime goal as it allows to understand and generalize results. This paper proposes a nov...

Evidence, eminence and extrapolation

A full independent drug development programme to demonstrate efficacy may not be ethical and/or feasible in small populations such as paediatric populations or orphan indications. Different levels of extrapolation from a larger population to smaller target populations are widely used for supporting decisions in this situation. There are guidance documents in drug regulation, where a weakening o...

Bubbles In Tehran Stock Exchange