I’ve posted Podcast #145 to the “RobCasts” section of the site. It’s called The Candyland Hypothesis: Why Short-Term Timing Doesn’t Work.
Academics developed the Efficient Market Theory to explain why even super-smart investors could not pick winning stocks in the short term. The “hypothesis” that they came up with is that the market prices everything properly. It now appears that a far better explanation is that the market prices everything <i>improperly</i> in the short term. This explanation is every bit as good an explanation of the fact that super-smart investors cannot beat the market in the short term. And the historical data — which refutes the Efficient Market Theory — supports the new explanation.