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Technology Stocks : Cisco Systems, Inc. (CSCO) -- Ignore unavailable to you. Want to Upgrade?

To: RetiredNow who wrote (56851)	1/23/2002 8:27:59 AM
From: Stock Farmer	Read Replies (1) \| Respond to of 77400

Mindmeld: Your statement "for every buyer there is a seller and vice versa" is true. But not equal to your earlier statement that "there are always exactly as many buyers as sellers", to which I was objecting. There can be ONE buyer and TEN sellers. Which one buyer is willingly buying everything that the ten sellers have to sell and would buy more. Thus driving the price up. Despite the fact that there are more Sellers than Buyers and an obvious inequality in the number of buyers and sellers. Nevertheless, on everything but the semantics we are agreed. You want to argue that trends always regress towards the mean? Hmmm... I suppose that leaves me to argue the other way around: that the mean regresses towards the trend. Which by the way is perhaps more true. For example, the 200DMA is a mean. If the stock price were to be flat for 200 days without moving, you would see the stock price trend nicely towards this mean. Although an observer would say that one changed and the other did not. Just food for thought. And being argumentative for fun :o) "I think we all agree that price trends track earnings growth pretty strongly". Strike the word "growth" and you have a deal. A cash cow with zero growth in earnings does not necessarily experience a zero stock price. Or at least, shouldn't. And my bet on stock price correlation is on earnings too. Stock prices go up over time. Yup. Mostly. The prices of those stocks that still exist today are generally higher than they were a long time ago. Of course, the prices of those stocks that no longer exist are generally much lower than they used to be. We need to be careful what we measure and how selection bias tilts our math.