Mark Cuban Weighs In On How The Stock Market Really Works

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These days, most people know Mark Cuban as the owner of the Dallas Maverics or from his latest gig on TV’s Shark Tank. What many people don’t know is that on his road to billions, during which he sold MicroSolutions and took Broadcast.com public, he rubbed shoulders with Wall Street elite more than enough times to get an idea of how “efficient” markets really work, and what he calls the “truth” about stock prices.

Have a look at what he has to say about his experience:

“The entire experience taught me quite a bit about how the market works. For years on end a company’s price can have less to do with a company’s real prospects than with the excitement it and its supporters are able to generate among investors. That lesson was reinforced as I saw the Gandalf experience repeated with many different stocks over the next 10 years. Brokers and bankers market and sell stocks. Unless demand can be manufactured, the stock will decline.”

Cuban goes on to recommend investors read The Number: How the Drive for Quarterly Earnings Corrupted Wall Street and Corporate America. I just bought it. Head over to Amazon to get it for yourself if you’re into this kind of stuff.

Read more here.

Photo Credit: kk+ and www.d210.tv