Modern stock-market commentary is always amusing. Maybe it’s the desire among writers to secure clicks in the age of the internet, but so much of the media chatter about markets focuses on the coming “boom,” “crash,” or the always “eerie” similarities to 1929, 1987, or 2008. That it does is a sign of how worthless most equity commentary is.
The great investor Ken Fisher writes that he often asks himself “What do I know that others don’t? Usually nothing!” Fisher adds that, “Markets price events faster than journalists write or speak because their sources or their sources’ sources already bought these events into profitless oblivion.” His broad point is that whatever you the investor think you uniquely know – an unsung nuclear threat, a big tax cut, government debt allegedly too burdensome to be paid back, or an obscure chart that “always” foretells market corrections – has already been priced.
Applied to market commentary about the good times or carnage ahead, anything the columnist presumes to know that will “move the market” has already been digested. Assuming it’s useful. Big market moves result from surprise, not from what you’re reading in an obscure newsletter, or in the business section of a major newspaper. If commentators were aware of the market-moving surprises ahead, they wouldn’t be commentators nor would they be telling anyone. They’d be too busy earning billions.