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The fact that you or I don't value an asset doesn't mean that that's asset value must therefore be zero. I wouldn't pay 5 million dollars for Michal Jackson's
by 21 9y ago
The fact that you or I don't value an asset doesn't mean that that's asset value must therefore be zero.
I wouldn't pay 5 million dollars for Michal Jackson's glove, but some people did. That in itself makes it more valuable that let's say it's cost of manufacture. And it's valuation is rational, but in a more complicated kind of rationality than the simple ones presented in economics 101 books.
I think you are a person which believes that this is a correct approach:
https://en.wikipedia.org/wiki/Homo_economicus https://en.wikipedia.org/wiki/Homo_economicus
I don't
- nikanj 9y agoI believe in the god of P/E. If you’re unable to find a greater fool to buy the Michael Jackson glove, how long do you have to hold it before the income covers purchasing costs? For Apple stock, the number might be high, but it is not infite. For Bitcoin, there’s _no_ annual income from holding it. Intangibles can still have substantial real value. For example, the Jackson record copyrights - while completely immaterial - still bring a very nice chunk of revenue every year.
- deleted 9y ago[deleted]