What does it take to move Bitcoin almost 20% more? How about Tesla (TSLA) – Get the report Chief executive Elon Musk simply tweeted “#Bitcoin”.
That’s what it did Friday morning and Bitcoin is now trading at $ 37,537.79, up 19%.
What is the contribution? Retail investors are in full throttle maniac mode.
It’s one thing to drive established companies, like Amazon (AMZN) – Get the report, Apple (AAPL) – Get the report and Nike (OF) – Get the report, to stretched valuations.
But it’s nothing else to overlook at GameStop (GME) – Get the report, AMC Entertainment (AMC) – Get the report, special purpose acquisition companies and bitcoin. Everything is speculation right now.
20 legendaryth Century economist John Maynard Keynes said investing in the stock market is like judging how others will judge a beauty contest.
In the case of bitcoin, weak-bottomed stocks, and SPACs, each judge rates the asset as a perfect 10.
Nothing here is new. Given human nature, bubbles have almost certainly existed since the beginning of time. It is possible that Adam and Eve caused a forbidden fruit test. On the 17thth century saw the Dutch tulip bubble and the XVIIIth century saw the bubble of the South Sea.
You are no doubt familiar with the latest bubble stocks: dot.com in the late 1990s and the real estate market in the early 2000s.
Bitcoin, the so-called junk stocks and SPAC, are simply a continuation of this line. Markets move between greed and fear, and right now greed is dominant.
Remember that periods of greed, in the financial markets or anywhere else in life, generally do not end well. For the most part, greedy people do not go unpunished.