Benjamin Graham, the most successful value investor of our century, told Warren a story he likes to pass on:-

Mr. Market is you business partner, appearing daily, offering to buy and sell your interest in the business.  Even though the business is stable, Mr. Market is anything but stable.  At times he's euphoric and sees nothing but good aspects for the business and he'll buy at any price and all that he can.

Then, he can get moody and depressed and see nothing but trouble ahead.  On these occasions, he'll sell all he can at price, unloading it on to others.  One other emotional characteristic occurs when he is ignored.   If he is trying to sell, you may decide not to buy.  He'll then get depressed and you can make a better buy at a lower price.

But like Cinderella at the ball, you must heed one warning, or everything will turn into pumpkins and mice.  Mr. Market is there  to serve you, not to guide you.  It is his pocketbook, not his wisdom that you will find useful.  If he shows up some day in a particularly foolish mood, you are free to either ignore him or to take advantage of him, but it will be disastrous if you fall under his influence.

Indeed, if you aren't certain that you understand and can value your business far better that Mr. Market, you don't belong in the game.  As they say in poker, "If you've been in the game thirty  minutes and you don't know who the patsy is, you're the patsy."

Related:

• Crises Equal Opportunities - History Makes Money

What $10,000 invested at times of various historical calamities would be worth today?  In 1962, the missile crisis brought us close to World War III.  At that time, if you had invested.........
 
• Trading In Stocks and Shares - Reminiscence of a Stock Operator

In order not to lose to the market, as a result of hearing too much good news or bad news to be affected, newbies being inexperienced with the tides and turns of events should have.......
 
• Don't Worry About the Market

A worry free wealth building strategy is to invest long term in the stock market. Why? Because history have proved that to profit from this simple, well known strategy, it doesn't matter in the.........