Stock prices do not always follow a random walk pattern as previously thought. Recent studies show that stock returns can be predicted to some extent using global economic indicators. The predictability of stock returns is not a sign of market inefficiency or irrationality. Instead, it can be explained by economic factors like mean reversion and consumption smoothing. This challenges the idea that unforecastable prices indicate a well-functioning market with rational investors. Time variation in risk is an important factor that should be considered when determining asset prices.