Question #2:  Can Stocks Ever Be “Underbought?”

“Some investors have expressed concern that popular trades are overbought, making them vulnerable to a sharp pullback.”

–“U.S. Stocks Drop as Investors Unwind Popular Trades”; The Wall Street Journal (3/21/17).

Here’s a suggestion for financial journalists:  instead of using meaningless, mumbo jumbo phrases like “stocks fell because they were overbought” (do they ever rise because they were “undersold??”), how about reverting to simpler, perfectly serviceable terms.

You know, words like “expensive,” “overvalued,” and “inflated”; or “cheap,” “undervalued,” and — heaven forbid — “depressed.”

Quibble #2:  name me one time in the last 40+ years when there weren’t at least a few “popular trades that were overbought, making them vulnerable to a sharp pullback.”

P.S.:  Sticklers will recognize phrases like “stocks fell because they were overbought” as a “tautology,” which Webster’s defines as “the saying of the same thing twice in different words.”

Which is not to be confused with another popular Wall Street term, “doublespeak” . . .   🙂

About the author

Ross Kaplan has 19+ years experience selling real estate all over the Twin Cities. He is also a 12-time consecutive "Super Real Estate Agent," as determined by Mpls. - St. Paul Magazine and Twin Cities Business Magazine. Prior to becoming a Realtor, Ross was an attorney (corporate law), CPA, and entrepreneur. He holds an economics degree from Stanford.

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