Mind Matters Natural and Artificial Intelligence News and Analysis

TagGreater Fool Theory

fake coins
Fake gold and silver coins closeup

In It For the Money: The Trump Coin Sham

Beware deceitful memorabilia hawkers who sell cheap mementos, hoping you'll be the fool that helps make them rich

Americans have a seemingly insatiable demand for memorabilia, no matter how cheaply it is made or how cheesy it looks. Some are preparing for their nostalgic years; some think they are making smart investments in collectibles that become more valuable as time passes. The problem with “investing” in collectibles is that an investment’s intrinsic value depends on how much income it generates. Stocks, bonds, rental properties, and profitable businesses all have intrinsic value. Mementos don’t. They rely on the Greater Fool Theory. If fools don’t appear, memento collectors are stuck with cheap and cheesy trinkets. This sobering reality does little to discourage people intoxicated by dreams of riches. For example, the White House Gift Shop sells a large collection of…

closeup-of-witcher-cauldron-with-magical-mixture-for-halloween-stockpack-adobe-stock.jpg
Closeup of witcher cauldron with magical mixture for Halloween

Bubble, Bubble, Toil and Trouble: Here We Go Again

Trouble brews when inexperienced traders try their hand at the stock market

The extraordinary investor and statesman Bernard Baruch once warned that, When beggars and shoeshine boys, barbers and beauticians can tell you how to get rich, it is time to remind yourself that there is no more dangerous illusion than the belief that one can get something for nothing. Over and over and over again, the unwary fall for money-for-nothing illusions — Dutch tulip bulbs, South Sea stocks, Japanese real estate, dot-com stocks, and bitcoin, not to mention baseball cards, beanie babies, and other so-called collectibles. Now we have a torrent of Reddit chatter inspiring the gullible to gobble up shares of GameStop, AMC, and whatever catches the crowd’s collective attention. Many Reddit-pumped buyers claim that they are part of a noble battle to punish…