An Example

In my post on Friday - "Leading Stocks Get No Respect" - I talked about how the leading stocks don't get...you guess it...r-e-s-p-e-c-t.

As an example of this, a prominent weekly financial publication came out this weekend and talked about how the oil and steel sectors are in a bubble. It also noted that these stocks have diverged from the fundamentals.

From my standpoint, price action and the underlying company are only related on a longer-term basis. And as Keynes said, in the long-run we are all dead. He also noted that a market can remain irrational longer than you can remain solvent. At least I belive it was Keynes...

In the short-term, stocks are influenced by emotion...fear and greed. With so many saying the leaders can't go on, you know there is money still sitting on the sidelines. Trends tend to run until the buying demand has been exhausted....

In other words, internet stocks were just getting exciting back in the day when bubble talk was starting...by the peak you saw mostly justifications for why they should keep running...