This is exactly why we have boom and bust cycles. Markets simply oscillates around the "true" value of assets. I suspect one can model these oscillations using control theory with a positive feedback system. The herd mentality is exactly an example of control system with positive feedback loop. When markets are up, nearly all analysts predict that next day it will be up as well until it isn't and then they all predict doomes day. Ultimately oscillations occur around the true value that is governed by inflation + GDP growth. Market will keep sliding down until it is 10-20% past this true value and then it will keep climbing 10-20% over that value. I wish I'd some time to chart this and test this theory...