No Matter What Anybody Says, the Markets Aren't Truly Efficient... And More on Buybacks
No Matter What Anybody Says, the Markets Aren't Truly Efficient... And More on Buybacks
The market has seemingly become so efficient, with so much information flowing so quickly in so many places, that it's as inefficient as it has ever been...
Here's what I mean...
The efficient-market hypothesis, as it's called, claims that stock prices reflect all available information.
Economists have been squabbling over it for decades, often using overly complicated algebraic formulas to prove their points. But like anything else, it shouldn't be that complicated... and it isn't.
After all, the whole concept is little more than a theory, not fact...
And even if the "markets" are efficient – which they're not – stocks certainly aren't.
That's the nature of investing and why there are bulls and bears...
Some stocks are overpriced and some are underpriced... but either way, they're mispriced.
Warren Buffett said as much in the Berkshire Hathaway (BRK-B) annual letter to shareholders over the weekend, writing...
"Efficient" markets exist only in textbooks. In truth, market…