“How Much Rational Behavior Should We Expect to See When Prices Have Gone This Far Out of Control?”

Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site:

you’re convinced that your speculation has tremendous value, despite a batting average that approaches .000.

Please consider what the P/E10 level has been for the entire time in which I have been putting forward these “speculations.”

You’ve heard the phrase “irrational exuberance,” right? At a time when the irrational exuberance reaches the sorts of levels it has reached in recent decades, do you think you could realistically expect to see anything different?

I’m not saying that I like this reality. I am just trying to provide a bit of perspective. How much rational behavior should we expect to see when prices have gone this far out of control?

Will rationality ever be restored? That’s the question. It always has been restored in the past. I think it will be restored this time too.

But I have been known to get them wrong from time to time. We are just going to have to hang in there a bit to find out for sure.

My best wishes.

Rob