Meet Mister Market and his mood swings

‘Mister Market’ was coined by influential British investor Benjamin Graham in his 1949 book “The Intelligent Investor”.

Graham uses the allegory of ‘Mr Market’ to explain the market mood. 
Mr Market is highly emotional : he swings between extreme emotions.

It is Mr Market that sets the price.  He offers us a price every day at which we can buy from or sell to him.
But he lets his enthusiasm and despair affect the price he is willing to buy or sell shares on any given day.

Why is this important ?