Counter point: beginning of 2021, for weeks I was wondering why the markets were not reacting to Covid.
Only when travel restrictions were introduced, and only when they were introduced to the US, the market started taking notice.
Does the market extrapolate future earnings and macro economic trends, sure. Do some people have secrete insights beyond that? Sure. But I'd say the market as a whole is pretty stupid and reactive.
Although market reaction is fundamentally hard to predict. It caughy many by surprise that markets reacted positively when Trump was elected. Or when there’s 150k people dead from coronavirus.
This is all public information. Why hasn't the market reacted?
EDIT: I was convinced what you said (or similar) was true and missed the better part of last year's gain. Going forward I will be very careful when people confidently claim that "things will be much worse". What I learned is that it is always the unpredictable stuff that tanks the market. So I might as well put money into the index and not wait or worry about it.
I think we're yet to see any sort of shock. The markets hit record levels in the U.S. after the Trump election. The entire system is oblivious to anything future related until it's too late. Totally reactive.
For institutional investors it will react maybe one quarter before it actually happens, and for retail it could continue even with their feet in water with good marketing.
The markets behavior is largely disconnected from GME though. We were on the upswing long before Jan 2021 because of all the money in the world looking for a place to go.
That said, I agree that many were surprised by the quick recovery (yay QE?).
It was not easy to see that the market would move incredibly higher over the course of the pandemic. Not in January 2020, nor any time since then. People can't even explain it after it has happened.
Look at mortgage rates for instance. Or just equities indeces.
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