Equity prices are distorted now as much as ever

 October 18, 2022,

I have noted that the financial services industry has been trying to kill value investing for years. They have continually dismissed Warren Buffett and similar other known value investors. They have turned the public to ETFs, easily controlled by narratives since traders have no idea of underlying fundamentals.

What has resulted is that equity prices today are no longer based on corporate fundamentals, which are outside the control of the financial services industry. Equities are now pushed and pulled by Fed policies, forex, commodity prices, and macroeconomic data, all of which are subject to Wall Street narratives that impact investor sentiment.

It’s pretty ridiculous to see the price of an Oiler stock, for example, plunge 5% or more in a day based on these black-and-white narratives when the company’s daily operations are producing record levels of revenue and free cash flow.

Every time I hear a big bank CEO talk about an economic crisis happening in six to 12 months, I know that it’s agenda-driven rhetoric and is truly unhelpful.

What I find shocking this week is seeing how profitable the big banks’ trading operations are despite the losses in the equity, bond, crypto, and commodities markets. So, the public gets taken to the cleaners, and the banks who serve them as fiduciaries boast about their profits. SICK


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