Standard models of informed speculation suggest that traders try to learn information that others do not have. This result implicitly relies on the assumption that speculators have long horizons, i.e, can hold the asset forever. By contrast, we show that if speculators have short horizons, they...

We are at the close of an era that has treated market efficiency with something bordering on religious wonder. When securities markets are understood as environments in which rational behaviour causes prices perfectly to reflect available information, regulators should hesitate to interfere...