Google just released Buzz, sort of a souped up Twitter. It’s an awesome idea, and as usual, Google has refined an existing idea to make it better.
First it was search, and Google made its first billion by dominating the search engine market with a better service. Yahoo and a dozen other search engines have faded into the background with the success of Google’s search algorithm. Then it was GMail, the application that made web based email actually work well. Then Chrome, which is way faster than Firefox and I raved about in this post.
And now Buzz, which allows us to aggregate and communicate Tweet-like messages. And it goes farther by inlining images and creating more communication with less clicking. It also integrates with Twitter, Flickr, and Google Reader.
We have seen massive losses in the markets over the last 6 months, and then a big runup over the last few months. People assume that the reason the markets have been going up is that the economy is improving, and the housing crisis is over.
It turns out that economic performance does not directly affect the movement of markets. How is this possible? Because economic performance does not buy and sell stocks. Human beings (and now computers) do. Therefore, market movements are a reflection of human psychology and have no direct relation to economics.
How can a computer possibly make money if the markets move with changes in human psychology?