=== SUMMARY ===
- The post explains the philosophical disconnect between short-term economic data and long-term market valuations, using a DCF framework as justification.
- Author's thesis: The stock market prices in perpetual cash flows, making it largely insensitive to temporary disruptions (lasting <12 months) that don't impact long-term earnings power.
- Quality assessment: Conceptual / opinion piece. It presents a simplified DCF principle to support a behavioral argument for long-term focus, but it is not well-researched DD on specific securities or market conditions.
=== SENTIMENT ===
NEUTRAL
=== TRADE IDEAS ===
No actionable trade ideas in this post.
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▶ Полный текст поста
I think we've all heard this phrase at one point or another, but it's never very well articulated as to why.
The reason is simple - the Market prices in the eternity.
If you've ever run a DCF, you'll often find that the majority of a company's value is locked in years 10 and beyond.
Going further than that, next year's earnings only account for \~5% of a company's total value, and the first three years of corporate performance only accounts for 10-15% of value.
\*\*\*This means that earnings can go to zero for the next 3 years and value should only fall about 15%\^1\*\*\*. It takes longterm impairment to impair value.
So when you see the Strait of Hormuz being shut down or GDP coming in soft or the next inflation print, think about how this effects long term earnings. If they're temporary (i.e., lasting less than 12 months), then it honestly shouldn't effect your decision making progress at all.
\^1 Assuming earnings are unchanged for years 4 and-on.