Formerly About Applied Materials Message Board

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Politics : Formerly About Applied Materials

AMAT 257.02

-1.1%

3:59 PM EST

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To: Cary Salsberg who wrote (62205)	3/21/2002 2:30:00 PM
From: Sam Citron	Read Replies (2) of 70976

Cary, The article that I quoted fails to mention valuation. It may be inferred that the author and/or Mr. Geist believes the stock market may be undervalued because it is not responding "appropriately" to positive economic news. But they do not explore the alternate hypothesis that the market has already discounted this rosy news and has fully priced in the recovery. [Thanks for this observation] I thought the article was interesting only because it posed a rather novel theory of post traumatic stress disorder as applied to financial shocks. I also happen to believe that in the short run the market responds more to emotional factors which influence participants' willingness to bear risk [Keynes' "animal spirits"] than to purely economic ones. Sam

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