Surprise Moves the Market

From the Wall Street Journal today: What Could Topple Bulls' "Wall of Worry"?....these types of articles can be found in print (newspaper and magazines), on the internet, or in discussion at the local coffee shop....just about anywhere and everywhere on land or sea...we get the litany of "worries" for the stock market. This is not a new phenomenon - year in and year out, we'll have to contend with and face the uncertainty of investing in intangibles. Today's list includes: High risk investments (subprime mortgages), global growth rates, inflation, the weak US dollar, and liquidity. Heck, I could type the same list 10 years from now and it will probably be the same worries then as now! I'm surprised they didn't have a few paragraphs about political instability, global terrorism, high oil prices, etc etc...The question that I think should be asked is: by how much have these "worries" been priced in by the market? On the face of it, none of these items will cause the market to roll over tomorrow...what WILL cause the market to change direction in a meaningful way (up or down) is when there is new information, or new surprises, for the investor to digest. The stock market in and of itself is a pretty good discounter of known information..sure, there are inefficiencies that can be exploited from time to time, but overall, millions and millions of investors making millions and millions of buy and sell decisions each day certainly brings a large amount of efficiencies to stock prices. Warren Buffett once said, "In the short run, the market's a voting machine and sometimes people vote very unintelligently. In the long run, it's a weighing machine and the weight of business and how it does is what affects values over time." That makes sense to me, and that is also why I don't get too pre-occupied with the latest headline about the dollar, oil, sub prime mortgages, etc etc...The key is to find and exploit existing trends, stocks on the move, and securities in favor, and finally, to maintain some risk management and stop loss discipline just in case you are wrong (or new information (aka surprise) causes your position to go the other way!!!) Good luck.