Many market observers focus on the news as the price driver. But consider Friday, Dec. 4 (Marketwatch): ‘Job growth has seriously slowed’ “The November jobs report on Friday showed the coronavirus battered U.S. economy regained 245,000 jobs last month … the “labor market is losing momentum.” Conventional wisdom says that investors react to news, stocks should have ended the day lower. Instead, the Dow hit a record 248 points higher. The chart below is an idealized representation of what would be the presumed effects on overall prices from a slew of bad earnings reports, an unexpected terrorist attack, a large stimulus program, a major GDP contraction, a government bank bailout, a declaration of peace after a time of war and a major rate cut in interest rates. Under this causal model, such events would rationally effect a change in overall stock prices. The problem is, this depiction does not match empirics. That is not how overall stock prices behave. There is no evidence that news and events drive the market’s long-term trend. Price patterns unfold according to aggregate mood and psychology.