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" When a system that works is found it is discounted and will no onger work. Isn't that the way it works? "

Yes, this is pretty much how it works. This is due to the interactive nature of markets.

When the observer is also a participant, the interactive effects (unpredictable portion) becomes large. This is what happens in the stock market all the time.

So, why is what this scientist is doing possibly different? Well, it may not be! (I am reading his book, BTW). However, there is a chance that he is getting to the actual core reason of why a certain stock market behavior (CRASHES) occurs. More importantly, it may be possible to objectively calculate when they are more likely. Granted, the previously mentioned interactive effect makes the prediction fairly wide. For example, one could never say there will be a crash tomorrow. More likely would be something like a crash is due in the next year or two. Most people would continue to find this worthless information. So, in a certain sense, the hub-bub about all this only amounts to anything if you are one of us nerdy people who study this sort of thing.

My own reasoning is that stock crashes can't occur unless stock prices get too high based on companies' potential future profits. Is that what happened in 1929, 1987, and even more recently? Yep, it is.

Basically, it comes down to this. The research in question indicates the stock market might be slightly predictable where it has always been thought to be totally unpredictable. Except to people who like to split hairs, this does not amount to much, yet.

Sincerely,
R.G. Boomers