Hello Mr. W,
I must commend you on your attention to details, as you are the first poster to notice I was talking about two things in my original post: stock picking and timing. I wish I knew how to insert clapping hands for you here.
Before I address your concerns, please excuse me as I can't help but to shake my head(s) since no one else had pointed it out even after I had spelled them out in italic in my second post. This may be pre-mature, but combined with the yoda speak confusion, I am beginning to wonder if this was a case of l2r (learn2read) and rpf (reading compre. failure). You will notice I tend to put clues in plain sight quite often, classic psychopath/villain stuff.
Now, regarding what you said. I recall you were one of the people asking me to explain my timing method earlier this year, I am not going to, but I will try my best to explain the way I see things and how I got on this path.
It is true that market timing typically revolves around watching some metrics and many people get destroyed (mis-timed) by following various indicators. However, if you believe that the market moves in tandem with the economy, ie, not just a simple random walk with an up-trend for no physical reason, then you would expect that sometimes (especially during major turning points of the cycle), you might be able to time the market with some success and confidence. Unfortunately, this also means that even if you succeed in timing the market using this method, your outperformance will be limited and any dreams of getting an annualized average return of 25%+ are quite unrealistic.
You said inefficiencies are only present at a granular level, I disagree. We behave irrationally all the time. Irrationality is an energy filed that creates and is created by all living things. It surrounds us and penetrates us; it binds our society together (maybe not the galaxy). At major turning points of the cycle, irrational behaviors beget massive bubbles and shear panic, which actually ties into the value investing principle, albeit by coincidence.
No, I am not talking about cape or any "simple" valuation methods/indicators. I am referring to what Buffett loves to use in his letters and speeches: the intrinsic value. Instead of individual companies, we would be dealing with the entire market (perhaps the economy itself), but the principles are the same or at least very similar.
If you instead believe that the market always moves independently of the fundamentals (underlying economy) in a simple random walk with an up-trend or is pretty much just psychology all the time, I have nothing more to say.
