Find related quotes, book, summary, meaning, origin of quote- In the short run, the market is a voting machine, but in the long run, it is a weighing machine.
It points to an enduring principle of value creation, visibility can be manufactured, hype can be temporary, but real value work always earns long-term respect and results.
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Meaning
Short term prices move with emotion and popularity. Long term value settles around real business strength and financial reality.
Explanation
When you watch the market closely, it can feel like a crowd reacting to every whisper. Prices rise and fall on excitement, fear, and headlines. This is the voting machine at work. Each trade is an opinion, not a measurement.
With patience, something changes. Noise fades. The market begins to observe rather than react. Earnings become more important than stories. Cash flow matters more than attention. The weighing machine takes over. It does not rush. It simply measures what is there. In the long run, value dictates price, without exception.
Summary
| Category | Wealth (120) |
|---|---|
| Topics | markets (4), value (17) |
| Style | concise (56), metaphoric (14) |
| Mood | reflective (52) |
Origin & Factcheck
This wisdom comes straight from the godfather of value investing, Benjamin Graham, in his 1949 masterpiece, The Intelligent Investor. It’s often misattributed to his famous student, Warren Buffett, but the credit belongs squarely with Graham from the United States.
Quotation Source:
| In the short run, the market is a voting machine, but in the long run, it is a weighing machine |
| Publication Year/Date: 1949; ISBN/Unique Identifier: 978-0060555665; Last edition: Revised Edition by Jason Zweig (2006), 640 pages. |
| Chapter 8, Approximate page 193 from 2006 edition |
Context
Benjamin Graham learned this lesson the hard way during market crashes and recoveries. His philosophy grew from watching emotions destroy wealth and patience quietly rebuild it. He reframed investors to step away from crowd behavior and anchor decisions in measurable value.
Usage Examples
- For a jittery investor: When investors start panicking over a temporary decline in a high-quality company, remind them that this is the market’s emotional side on display. The voting machine is shouting. The weighing machine is the one that ultimately decides value, and hasn’t even looked up from its newspaper.
- For analyzing a “hot” stock: A rising price doesn’t always signal a rising business. At the moment, sentiment is doing the heavy lifting, not fundamentals. The market may be voting in favor today, but in the long run, only measurable economic weight determines where a stock truly belongs.
- For my own discipline: A grounding principle when temptation pulls attention away from fundamentals.
This quote is for every single person who gets caught up in the daily drama of the ticker tape. It’s for the long-term investor, the value seeker, the one who wants to build real wealth, not just trade stories.
To whom it appeals?
| Audience | economists (11), investors (99), students (437), teachers (193) |
|---|---|
This quote can be used in following contexts: investment classes,economic discussions,stock analysis articles,long-term investing blogs,conference keynotes
FAQ
Question: How long is the “long run”?
Answer: There’s no fixed duration, just the time needed for real results to assert themselves and reshape market perception.
Question: Does this mean technical analysis (chart reading) is useless?
Answer: No, it’s simply a tool for reading the market’s voting machine. It reflects short-term sentiment and momentum, but long-term wealth requires respect for the weighing machine of fundamentals.
Question: What’s a sign the “weighing machine” is starting to work?
Answer: When the stock’s valuation becomes increasingly tied to its financial performance, rather than short-term sentiment effects in the broader market.
Question: Can the voting machine influence the weighing machine?
Answer: Indirectly, an excessively high stock price can act as cheap currency for a company, allowing it to fund acquisitions or raise capital, which might strengthen its fundamentals. But such cases are rare.