I always believe that prices move first and fundamentals come second

The quote “I always believe that prices move first and fundamentals come second” is a perspective on the relationship between market prices and underlying economic fundamentals. Essentially, it suggests that changes in prices, particularly in financial markets, occur before changes in the fundamental factors that theoretically drive those prices, such as earnings, interest rates, or economic indicators.

This perspective challenges the traditional economic theory that prices are primarily determined by fundamentals. It implies that prices can be influenced by a variety of factors, including investor sentiment, market speculation, and other non-fundamental factors. This can lead to situations where prices move in ways that seem disconnected from underlying fundamentals, at least in the short term.

Applying this idea to today’s world, it can be seen in phenomena like the rapid rise of certain tech stocks or cryptocurrencies, which some argue have outpaced any realistic assessment of their underlying value. It reminds investors that while fundamentals are important, they are not the only factor driving price movements, and that markets can often be influenced by trends, speculation, and other dynamics that can cause prices to move ahead of fundamentals.

In terms of personal development, this quote could be interpreted as a reminder that perception often precedes reality. Just as prices can move before fundamentals in financial markets, our attitudes and beliefs can shape our actions and outcomes before any actual changes in our circumstances. For example, if we believe we are capable and deserving of success, we are likely to take actions that lead to success, even before we see any concrete evidence of it. Conversely, if we believe we are destined for failure, we may act in ways that make failure more likely, regardless of our actual potential. This idea underscores the importance of mindset in shaping our reality.