...as I'm fond of telling the analysts, if it's in the newspapers, it's in the price. So you really need to understand what isn't in the price, what isn't being discounted, what events can happen that will lead the market to think differently...
...If gasoline prices go up, you're going to drive less. So price and demand are inversely correlated: basic economics..But in financial markets, it isn't the case. Here, demand is positively correlated with price. More people buy things when they go up; if stocks start to go up, more people want them than if they're going down. The higher they go up, the greater the demand for them.... financial assets particularly - it's been very well established that demand follows price....
Entire interview here.
Planning to read Fortune’s Formula by Bill Poundstone soon.
