Efficient-market hypothesis is sometimes mistaken for an excuse for the excesses of Wall Street; whatever else those guys are doing, it seems to assert, at least they’re behaving rationally. A few proponents of the efficient-market hypothesis might interpret it in that way. But as the theory was originally drafted, it really makes just the opposite case: the stock market is fundamentally and profoundly unpredictable. When something is truly unpredictable, nobody from your hairdresser to the investment banker making $2 million per year is able to beat it consistently.
