I’ve always been a fan of the efficient market theory for Wall Street, the argument that a company’s stock price at any given time accurately reflects all relevant information concerning that company. My faith suffered a jolt yesterday, though, when GPS manufacturer Garmin lost 18% of its value and Tom Tom 21% on news that Google had come out with a free map/driving application for cellphones.
Why? Because I’m a pretty clueless guy who doesn’t own stocks and therefore doesn’t follow any particular company’s prospect except from a general sense of curiosity, yet two months go I wrote abut Google’s progress in this direction and predicted the demise of Garmin and its competitor,Tom Tom. My point is, if idle curiosity could produce such a prediction then, shouldn’t the market analysts who follow these companies have done the same thing a year ago? So what kept their prices so high until yesterday? Fly, Retired IB’r,Shoeless and all you other finance experts are invited to educate me (Cos Cobber, you can chime in and tell us how Cos Cobbers don’t need no stinkin’ GPS cause they never leave their hollows). Thank you.