Markets Are Always Looking For Reasons(5)

Discounting instrument

Markets are necessarily a discounting instrument.

It tries to discount all the realistic projections, net present values, etc... as best it could.

The stock market would move up to try and discount that properly.

In general, the stock market cannot look too far ahead, 12-18 months is about as far as it will go as studies have shown that markets seem to regard anything longer than that as too wishy-washy to take into account properly

(i.e. too many variables and things can happen to change the equation).