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Rational Exuberance (Silliness) or Irrational Exuberance?…Speculation as Entertainment Shows No Signs Of Slowing Down

 

Rational Exuberance (Silliness) or Irrational Exuberance?…Speculation as Entertainment Shows No Signs Of Slowing Down

Courtesy of Howard Lindzon

Every morning I wake up, splash water on my face, change into a fresh t-shirt and depending where I am, I fire up my desktop Mac, my Macbook or my iPhone to check the trending streams on Stocktwits.

For the last 90 days, every time I do that I am shocked by some huge move in a stock I have never heard of or a crypto ticker I have never heard of.

By the time I do some clicking around and checking, I am 30 minutes behind in my morning.

It is fun. It is exciting. I am entertained. And I have no idea WTF is going on.

The textbook has been thrown out the window. I am cool with that. I will take my chances investing against everyone else with no ‘agreed upon textbook of fundamentals’.

I am ok with people making fortunes off what looks silly to me because they took a shot and rode a ‘meme stock’ or NFT or ‘blockchain’ they read about on Stocktwits, a crypto blog or Discord room. Keeping money made this way is not easy.

One unintended consequence of the long boom from technology and cheap money is a wider wealth gap with some random new wealth shooting stars.

In December 1996, Greenspan used the term ‘irrational exuberance’ … a fair warning to investors in hindsight. Since then, the FED and the markets have been almost completely politicized so ‘rational silliness’ and ‘speculation as entertainment’ will persist. Betting against the printing has been irrational.

The hard part is trying to manage the ‘rational exuberance’ or what I can the silliness from this cocktail of technology and easy money.

There is NO sign of the speculation as entertainment slowing down…

More stats:

Our firm Social Leverage is an investor in Alpaca (a Drivewealth competitor) and the growth from financial apps ‘connecting’ to Alpaca to light up investing and trading is phenomenal.

If nothing else changes the supply will eventually dwarf the demand and buyers will exhaust. In the meantime, wow.

PS – Did Dillards’s discover a cure for cancer….

Like I said…no textbooks allowed.


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