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by tc313 1573 days ago
“In the short run, the market is a voting machine but in the long run it is a weighing machine.”
2 comments

Unfortunately, the stock market also has no real distinction between what a long or short run is :\.

"The market can remain irrational longer than your can remain solvent" is the relevant platitude.

I worked in prop trading for half a decade and the number of really catchy, pithy sayings they have NEVER ceased to amuse me. My firm was very much on the "voting machine" time horizon so at that time granularity all the notions of company value mostly end up being 0 effect and everything is totally dominated by statistics, but that never stopped us from all joking about these catch-phrases and nodding sagely (as the computers do all the work of actually trading the stocks).

> “In the short run, the market is a voting machine but in the long run it is a weighing machine.”

Today's "short run" is last year's "long run" so either that statement is false or voting and weighing machines are the same thing.

It sounds profound though.