On the other hand, you got to understand their point of view as well, even then market valuations were somewhat exuberant (hey, AG complained about irrational exuberance a full two years ahead of that <g>), and they simply refuse to believe that markets do go to extremes, and determining how extreme is extreme enough, is not in the purview of fundamental analysis, only technical analysis has a chance (and even then, only a chance) to call changes in market psychology. By Jove, even at 1600, the Naz was still overvalued. The Dow for the last three years or more has not even come close to be "rationally priced", and the last time S&P 500 has seen "rational prices" was in 1990, if memory serves.
The lesson is that being too smart can damage your pocket book, as a recent study of the market performance of Mensa members showed (they averaged 2.5%/year over these great market years till 2000 came around).
Zeev |
