literally, as in Keynes’ (1936) phrase, taking into account “what average opinion expects the average opinion to be.”
…perfect rationality in the market cannot be well defined. Infinitely intelligent agents cannot form expectations in a determinate way.
This type of behavior–coming up with appropriate hypothetical models to act upon, strengthening confidence in those that are validated, and discarding those that are not–is called inductive reasoning.
We see immediately that the market possesses a psychology. We define this as the collection of market hypotheses, or expectational models or mental beliefs, that are being acted upon at a given time.
the first(?) mention of a genetic model in the book