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What does the market know?

The market does not have above average insight, but often is above average in emotionality.

People influence each other, and their emotions compound, so that the overall level of panic in the market can be higher than the panic of any participant in isolation.

MY buddy Sandy was an airline pilot. When asked to describe his job, he always answers: "Hours of boredom punctuated by moments of terror." The same can be true for investment managers, for whom the last few weeks have been an example of the latter. We've seen bad news and prices cascading...