Why is the market so stupid and wrong most of the time?

Discussion in 'Psychology' started by Cutten, Mar 30, 2009.

  1. Look at the share prices of financials, real estate firms, and auto companies over the last 2 years. It was so obvious they were worth diddly squat and yet the market kept pricing them at ludicrous levels for 2 whole years. Even now when it's obvious most are worthless, at least in the equity, they still trade at billion or ten billion market caps.

    Same happened with dotcoms.

    Why is the market so stupid and blind to what is obvious right in front of its face?
  2. Because the mkt loves logging on ET after the close and seeing people get so angry at it for not doing what they thought it should :D

  3. Lucrum


    Do I detect the frustration of a losing trade or day?

    I ended up in the red today.

    But it was my stupidity, not the markets.
  4. there is a huge incentive to beliieve the good times will never end and behave as such in booming industries.

    Its cult like when the pillars of their belief start getting kicked out from under. Its hard to make hay on a systemic level while the sun shines.
  5. eagle


    The art of the Tulip mania.
  6. pspr


    Read a little Jesse Livermore sometime. Dutch tulip stories are good too.
  7. Yes long live Jesse :)
  8. asap


    "Why is the market so stupid and wrong most of the time?"

    too many stock_trad3rs out there? :confused: :p :D
  9. LOL
  10. For 1.99 of those years, the market was right.
    #10     Mar 30, 2009