(l21) And while important, it is unlikely that a

rational investorHowever, Samuelson (1971) has pointed out that

rational investors need not have the logarithmic utility function that maximizes long run wealth growth.

The remedy, they thought, was to recharacterize firms as virtual public utilities with public duties.(35) The

rational investor of modern capital asset pricing models, viewed through the lens of Berle and Means, looks like an aggravated version of what they feared.

Then this author writes: "If [[Y.sub.M]] were greater than (1 - T[prime])Y,

rational investors would invest in municipal securities; if it were less they would invest in corporates."(5) Apparently so-called "rational" investors will never express a preference for a convex combination of the two kinds of bonds.

(4) Blanchard (1979) and Blanchard and Watson (1982) have shown that if a bubble will crash with some probability,

rational investors can be compensated with a risk premium if the bubble rises fast enough.

The lesson: for a

rational investor who thinks in terms of the business behind the stock, the best time to buy is when it is available at a deep discount to its value.

Still, the S&P'S drop in 2008 has evaporated roughly $2 trillion in retirement savings, and that's enough to make even the most

rational investor frightened.

At the same time as announcing the in-depth investigation, the European Commission said that it has reached the conclusion that the capital investment of FMG in the Terminal 2 project is free of any state aid elements because FMG had acted as a

rational investor would have done given the need to build a new terminal.an

Several areas must be considered before a

rational investor would consider purchasing an emerging European investment.

Our article therefore asks a simple question: What is the liquidity premium that a

rational investor will demand to compensate for the inability to maintain a properly rebalanced and diversified portfolio?

(1991) discuss a possible strategy of a

rational investor: buy the shares of a closed-end fund and sell short the underlying assets, which are often large-cap stocks.

Recalling that Greek bonds have been downgraded by rating agency Standard and Poor`s to junk, the Commission noted "when an investment amounts approximately to the size of the bank`s own capital, the least the average

rational investor would expect is to be informed, which was not the case".