Should We Care What the Stock Market Thinks?

Today, when the new Treasury Secretary, Timothy Geithner, stated laying out the administrations plan for the economy, the stock markets plunged. Should we care that the markets think the plan is not good enough? In a word "NO". Here is why.

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First the people who are making the decisions on a daily basis that cause these wild fluctuations in stock prices, are the same ones who got us into this mess in the first place. Thier entire business model has been based on the fallacy of every expanding credit and consumption. They have proven that they have no idea what a good solid business looks like. Yet somehow we still think that their vote counts. Second, these people have been living off the fat of the land, sucking value from our system, while providing none. What they have done has amounted to legalized robbery. That has ended. They are going to have to get real jobs and try to make an honest living. Of course they are not going to be happy. Third and perhaps most important. Markets are absolutely awful at measuring the value of anything in the short term. Warren Buffet famously said that markets are "voting machines" in the short term. It takes a much longer period of time for the market to come close to measuring the value of any company or asset. There are plenty of people out there who are creating new companies and new businesses based on the new realities of today. Lets look for, and support, these new entrepreneurs, rather then paying attention to the people on wall street. They have already proven they haven't got a clue!