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Matt Levine calls this the "bored market hypothesis": people are investing purely for fun, in significant enough numbers to actually move the market.

• whimsicalism 6y ago
  Eh. If retail investors are investing in the same direction "just for fun" then the real institutional investors will just short their bet.
  • lordgrenville 6y ago
    Unless the market can remain bored longer than institutional investors can remain solvent...
    • whimsicalism 6y ago
      > Unless the market can remain bored longer than institutional investors can remain solvent... Don't let nit-picky facts like that institutional investors control substantially more capital than retail investors get in the way of a good narrative.
      • dralley 6y ago
        Tell that to all of the institutional investors that have lost money shorting Tesla. No, there is no good reason for Tesla to be valued the way it is - but there is no shortage of people willing to buy it without putting too much thought into the price, either.
        • marketgod 6y ago
          Tons of good reasons. My model says $TSLA should be $1,000 a share and is undervalued. It should be there for March and even earlier. $5,000 in a decade.
          • apexalpha 6y ago
            haha, are you on the wrong site?