The Average Is Not the Norm

The stock market goes up 20 % a year. Last year, the return on the s and p was 27%. Sometimes it doesn't go up at all. Why is the stock market so much more volatile then the underlying corporate profits? And the answer is the involvement of people. That's what the market is. There is no such thing as the market. It's just a bunch of people and institutions and organizations and companies spread around the world. People are dominated in the short run by their psychology and their emotions. This is what makes the market so valatle and so unpredictable. In real life, things tend to fluctuate from pretty good to not so hot. But in the market