READING: From 2021: Matt Levine on Elon Musk as Meme-Purveyor: "Things Are Valuable Not Based on Their Cash Flows, But on Their Proximity to Elon Musk"
READING: From 2021: Matt Levine on Elon Musk as Meme-Purveyor: "Things Are Valuable Not Based on Their Cash Flows, But on Their Proximity to Elon Musk"
Matt warns: reading this will make you stupider; writing it made him stupider; religious awe and social coördination as supplements to fundamentals as sources of enduring value…
Jeez, the art market has worked this way for a long, long time. Value relies on the afflatus of the artist, measured by …
Money kinda works this way, too, except that people actually need money. However, the Yankee dollar still derives its value from the afflatus of Uncle Sam.
Stock prices have always been about collective belief. Stock memes aren't new. Look at "plastics" in The Graduate. Plastics was one of a many popular memes in the 1960s, and stocks would go up in response to the appropriate buzzwords. It was the "computers" that made Leaseco so much more valuable than a similar truck rental firm even if computers depreciated more quickly than trucks. The 1970s were unusual in that there weren't many memes or buzzwords that could drive stocks away from their fundamentals.
I'm a big fan of Matt Levine. He reminds me of John Brooks who often wrote tales of high finance with a humorous twist back in the 1960s.
Speaking of jokes, Gamestop seems to be a perennial punchline. Does anyone else remember the First National Bank of Gamestop from back in 2014? It was on 4chan and republished by Jason Kottke on his website. Basically, the 4chan author got tired of bank fees, so he started using Gamestop as his bank. When he got his paycheck, he'd pre-order a bunch of games. When he needed money, he canceled an order and got a refund. Unlike a regular bank, he could even sell old games there for cash.
Financial markets have always been driven, to some extent, by speculation unrelated to fundamentals , and massively so in the era of neoliberalism. DeLong et al had something to say about this in 1991, IIRC. Dogecoin is particularly absurd, but Bitcoin showed the way to attach massive valuations to totally unproductive assets
Matt Levine is a treasure.
Jeez, the art market has worked this way for a long, long time. Value relies on the afflatus of the artist, measured by …
Money kinda works this way, too, except that people actually need money. However, the Yankee dollar still derives its value from the afflatus of Uncle Sam.
Well, partly. There is great art and there is not so great art which comes and goes
Stock prices have always been about collective belief. Stock memes aren't new. Look at "plastics" in The Graduate. Plastics was one of a many popular memes in the 1960s, and stocks would go up in response to the appropriate buzzwords. It was the "computers" that made Leaseco so much more valuable than a similar truck rental firm even if computers depreciated more quickly than trucks. The 1970s were unusual in that there weren't many memes or buzzwords that could drive stocks away from their fundamentals.
I'm a big fan of Matt Levine. He reminds me of John Brooks who often wrote tales of high finance with a humorous twist back in the 1960s.
Speaking of jokes, Gamestop seems to be a perennial punchline. Does anyone else remember the First National Bank of Gamestop from back in 2014? It was on 4chan and republished by Jason Kottke on his website. Basically, the 4chan author got tired of bank fees, so he started using Gamestop as his bank. When he got his paycheck, he'd pre-order a bunch of games. When he needed money, he canceled an order and got a refund. Unlike a regular bank, he could even sell old games there for cash.
>>I have gotten stupider by typing all of that, and you have gotten stupider by reading it, but it’s gonna get worse<<
Yikes! I've been warned <head-scratch> ..my poor little head..
Financial markets have always been driven, to some extent, by speculation unrelated to fundamentals , and massively so in the era of neoliberalism. DeLong et al had something to say about this in 1991, IIRC. Dogecoin is particularly absurd, but Bitcoin showed the way to attach massive valuations to totally unproductive assets
https://www.nytimes.com/2018/02/08/opinion/bitcoin-financial-markets.html