Howard Marks: Why the market went up

 “We watch TV,listen to radio or read newspapers.I’m always amused when the pundits say , “stocks went up today because several companies beat analyst’s earning forecasts” or “the market dropped because of increased uncertainty regarding the price of oil.”How do they know?Where do buyers and sellers register their motivations ,such that the media can discern them so definitely?

There’s only one indisputable explanation for why the market went up on a given day:there were more buyers than sellers.When buyers have greater influence in the market than sellers -because would-be buyers predominate relative to sellers;buyers feel more urgency than sellers;or buyers want to buy more shares than sellers want to sell-prices rise.Under those circumstances,sellers enjoy great liquidity and buyers have to pay a premium over prior prices.”-wrote Howard Marks


Charlie Munger on Gambling in the Stock Market

“I knew a guy who had $5 million and owned his house free and clear. But he wanted to make a bit more money to support his spending, so at the peak of the internet bubble he was selling puts on internet stocks. He lost all of his money and his house and now works in a restaurant. It’s not a smart thing for the country to legalize gambling [in the stock market] and make it very accessible.”-said Charlie Munger