Monday, August 9, 2010

Quality Stocks: Ping Pong Balls Under Water

From Jeremy Grantham's essay The Fearful, Speculative Market:

Supply-demand issues...can be powerful in distorting prices in the short run and even the quite long run, but it is like holding a ping pong ball under water: it needs constant pressure to keep it there. Remove the pressure even for a short while and the normal equilibrium will quickly be restored.

The core economics win out in the long run.

Adam

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