The market is a wacky phenomenon that by all accounts acts independent of the way in which we perceive its supposed direction. In simple words, you can’t guess what it will do next. We cannot wish it into complying with our desires. The last several years have been extremely difficult for many investors, concerned about the overvaluation in stocks, macroeconomic issues, etc. What’s more perplexing is the noise from that entity known as Wall Street that cries that stocks are cheap and that all is well, while others sing the opposite story. Deep within, many of us have serious doubts and are waiting for something to happen, not knowing what that something may be. A pullback? A major downturn? A crash? Maybe it will keep going up and we will miss out while sitting on the sidelines.
Benjamin Graham warned us of this very fact. His story of Mr. Market in “The Intelligent Investor”, shows a bipolar organism with a mind of its own that is not telling anyone what it is thinking. Mr. Market prices stocks at sometimes wildly different prices each day, and Graham summarizes with: Continue Reading »