While watching the video below, interviewing Art Cashin on his market view, the stock market is discussed as if valuation never matters, or as if prices relative to past highs don’t matter either.
The current market is even compared to the dot-com bubble, even though there is a huge difference – most stocks are nowhere near peak levels on valuation or price unless you believe the U.S. economy will stop growing for about the next five years (If you do, then fair enough). Even if someone disagrees on the exact valuation, the greater point is that not much is really said in the interview, yet we get a lot of catchy lines.
The video reminded this author about something he had noticed while working on the sell-side – that investment acumen and market feel have little to do with success for most positions, even when in the trading room or at a senior position. Unless you’re a prop trader or someone making direct investments. That’s because your job is usually all about getting people to invest, or managing people who are doing so, rather than to actually invest. A day trader at home learns more than a sales trader on Wall St.
We don’t mean to single out Mr. Cashin, who’s probably a great guy and is far better than most. The video is just an example.