3 ms·
Things (shares, companies, objects, currencies, oppurtunities, gold) are worth what people will pay for them. That's it. There is no objective "value" other tha
by Jabbles 16y ago
Things (shares, companies, objects, currencies, oppurtunities, gold) are worth what people will pay for them. That's it. There is no objective "value" other than that.
- reitzensteinm 16y agoThat's their price, but price and worth are different things during periods of irrationality. I think it's pretty clear that people are projecting what Facebook will be worth when it hits a Microsoft 00s style plateau, and deciding on what the price should be now to reflect that. After all, Yahoo's market cap peaked at $152 billion and Google's IPO was 1/6th today's price.
- ekidd 16y agoThis isn't always true. A company is worth the expected net present value of all future dividend payments. If a company is both unsexy and well-managed, you may be able to buy its stock at a very good price, and then collect a fat profit of the dividends.
- eru 16y agoTo be a bit more pedantic: You have to include share buybacks and a possible (last) liquidation dividend.