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Many people say that the markets are inefficient in the short-term and efficient in the long-term....

Many people say that the markets are inefficient in the short-term and efficient in the long-term. What would Keynes say about this? Explain.

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Answer:-

Yes, It is correct that markets are inefficient in short-term and efficient in the long term basis below points

1.We can't compare the short term results of market vis-a-vis with those of long term.

Because, Short-term results whether positive or negative may have a effect of volatility.

If there is a Positive sign in short term result it might be possible that positive result is due to inflation effect.

If there is a negative sign in short term result it might be possible that negative result is due to deflation effect or some market crisis.

Actual correct result of market can be predicted only in long term horizon which is also explained in keynes theory

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