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0 pointschii9y ago0 comments

Except the market can stay irrational longer than you can stay solvent.

The issue is that any open version of a product has to compete in such a way that matches the buy cycle of the product. I don't imagine farmers buy new combines every year! These things has to work for decades! Ditto with a lot of idustrial machinery.

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stagbeetle9y ago

> Except the market can stay irrational longer than you can stay solvent.

This applies solely to stock market speculation, due to a perfect amalgamation of human psychological biases and fallacies.

In consumer economics we use utility value (iirc, it's been far too long since I've opened a textbook). Consumers will definitely drop their JD's if a "no-bullshit," almost as good option comes along, because the utility value gained will be higher than the asset loss.

michaelmrose9y ago

This assumes consumers actually rationally assess the value and don't value emotional brand attachments.

MichaelBurge9y ago

We're talking about farmers, not porn viewers. We not only can assume they're rational, but have spreadsheets for financial modeling and a dedicated capital expenditures budget. And if they don't do any of these, it would be easier to buy them out and replace them with someone who does.

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