Interesting conference by G. Soros at the CEPS (Center for European Policy Studies) on April 18th where he presented his latest book (The New Paradigm for Financial Markets: The Credit Crash of 2008 and What It Means).
G. Soros suggests that the cause of bubbles often lies in wrong academic approaches as to the relevance of "reality" and "perception of reality" factors in social and economic matters.
As a practical man, he recommends more regulations and that a more active role be played by financial authorities. I agree with that.
However, his proposals do not answer the more fundamental questions which he raised.
The duality "reality/perception of reality" could be viewed within the framework of the emergent behavior theory which can provide a meaningful concept for describing a fundamental issue at the core of the formation of bubbles: stock market bubbles do form because of the lack of an emergence property in the price settlement process.
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