ABSTRACT
One source of misunderstanding is Soros’ conflation of rational expectations theory and the efficient markets hypothesis (EMH) with economic theory. The EMH is not representative of economics as a whole: it is a particular, and highly contentious, application of the theory of rational choice that lies at the core of most neoclassical economic models. As a mere point of logic, the failure of EMH can hardly be imputed to economics in general.
