History demonstrates that participants in financial markets are susceptible to waves of optimism. Excessive optimism shows the seeds of its own reversal in the form of imbalances that tend to grow over time.
The most common cause of low prices is pessimism - some times pervasive, some times specific to a company or industry. We want to do business in such an environment, not because we like pessimism but because we like the prices it produces. It's optimism that is the enemy of the rational buyer.
An optimist will tell you the glass is half-full; the pessimist, half-empty; and the engineer will tell you the glass is twice the size it needs to be.
But the nearer the dawn the darker the night, And by going wrong all things come right. Things have been mended that were worse, and the the worse, the nearer they are to mend.
There is an optimism which nobly anticipates the eventual triumph of great moral laws, and there is an optimism which cheerfully tolerates unworthiness.
Most of us stand poised at the edge of brilliance, haunted by the knowledge of our proximity, yet still demonstrably on the wrong side of the line, our dealings with reality undermined by a range of minor yet critical psychological flaws (a little too much optimism, an unprocessed rebelliousness, a fatal impatience or sentimentality). We are like an exquisite high-speed aircraft which for lack of a tiny part is left stranded beside the runway, rendered slower than a tractor or bicycle.
We should cultivate the optimistic temperament, and endeavour to see the good that dwells in everything. If we sit down and lament over the imperfection of our bodies and our minds, we profit nothing; it is the heroic endeavour to subdue adverse circumstances that carries our spirit upward.