Rational Behavior

We presume that it exists in the long-run. Markets, over time, are weighing machines. In the short-run, they are sentiment machines. Thanks, Warren Buffett, for that one.

But then you have to ask, "what's rational, and to whom?" Think: suicide bombers. Well, maybe it's rational to some. For others, uh, not so much.

What about markets? The internet investing world of 1999 was...not rational. Crap.com could be brought public at 100 times revenues. Speculators bought...and then, when April of 2000 came along, and the markets crashed, then yes, it proved itself (T.S. Eliot style) that it was, in fact, the cruelest month.

Rationality, like beauty, lives in the eye of the beholder.