“Logic is the subject that’s helped me the most in picking stocks, if only because it taught me to identify the peculiar illogic of Wall Street. Wall Street thinks just as the Greeks did. The early Greeks used to sit around for days and debate how many teeth a horse has. They thought they could figure it out by just sitting there, instead of checking the horse. A lot of investors sit around and debate whether a stock is going up, as if the financial muse will give them the answer, instead of checking the company.”
Peter Lynch, One up on Wall Street
In his letter to Amazon shareholders for the year ending December 2000, Jeff Bezos began with the word “Ouch”. Given market conditions since November 2021, it seems appropriate to reflect, not just upon the word itself, but the context in which it was written. Amazon had closed that year with a market cap of $5.6 billion having fallen from $26.3 billion the prior year end. And nine months later, by September 30th, 2001, the market cap had halved again.