A lot of smart people have lost money on the belief that trends that seem unsustainable must reverse or that history must always repeat, when there are factors that can cause wildly diverging outcomes even when there are many similarities between the past and present. You can have a situation where the past matches the present with 99% accuracy, but that 1% makes a huge difference in outcomes. This is related to chaos theory, where small perturbations in the initial conditions can cause the evolution of the system to change dramatically. Many people lost money shorting Amazon and Facebook stock between 2012-2015 on the belief that we are in another tech bubble, and while there are many similarities between 2000 and now (such as high stock prices) there are some subtle differences, too, such as better fundamentals. And those subtleties make the difference between a profitable trade and losing your shirt. Or another example, may people got burned betting against the stock market recovery, since 2009, believing that there would be a double dip recession, that there would be a 'Great Depression', or that America would become Japan 2.0, when, in fact, neither happened despite the many similarities. These short-sellers grievously underestimated the propensity of the consumer, undaunted by the doom and gloom in the news, to keep consuming and the unimpeded ability of S&P 500 companies to keep generating record profits and earnings.