Kay
Mind of the Market
is the notion that The Market has a Mind, namely that there is something more going on in the determination of security prices than unemotional evaluation of publicly available information.The fact that The Market has a Mind, and wants to have one, explains the intense concentration of market-making activity. Even with the availability of Bloomberg terminals it is deemed important To Be There. For example for a chance to notice who lunches with whom, which might give a clue to impending merger activity.
Fernand Braudel (La Dynamique du Capitalisme) describes how in the past there was a single financial centre where the big deals were done. These were, starting with Venice in late medieval times and then Antwerp, Genova, Amsterdam, and London, ending with New York in the twentieth century.
It is only recently that the uniqueness phenomenon has become less pronounced. This is to be expected with lightning-fast communications. As a result there is significant financial activity in Connecticut. London is still significant. But note the difference in scale: for example the big investment banks supervised by New York state paid 30 billion in bonuses in 2008; in London this was 8 billion.
To put all this in perspective, remember that the most successful investor makes a point of not being around Wall Street. Instead he stays in Omaha.
See also (or, in this case, especially) Efficient Market Hypothesis.
