Its a chaotic tipping point. The analogy for the market for lemons isn't as good as an analogy with 80s junk bonds. Groupthink is incredibly strong so if ther

Its a chaotic tipping point. The analogy for the market for lemons isn't as good as an analogy with 80s junk bonds. Groupthink is incredibly strong so if there's an underserved market, well, tough cookies for them, until the underserved market is so huge someone eventually takes the bait. Given that its been an underserved market for a long time, its pretty easy for the first entrant to make insane profits off the first couple deals. Then the usual suspects gather around and say they knew it all along that it was always the best idea ever and its going to be the new paradigm for the entire market going forward and only the best people have been in it from the start. By then even the slower retail investors are piling in, like an out of control crowd at a sporting event, and the crowd is starting to crush people. Of course its a very small market so returns seemingly instantly go from insanely high to insanely low because there's not many good deals in a tiny market, because its a tiny market, but the money is pouring it from the late entrants. Then when the new deals all collapse, the usual suspects lecture everyone about the inherent evils of capitalism and how they knew it was a bad idea all along, and everyone forgets about it until the cycle repeats. There is a valid realistic market for SPACs which are kind of "headhunter for mergers with small companies" but the problem is there's too much cash sloshing around and ALL of it flows at the same time to whomever had the highest rate of return last year, even if the market of good deals in that sector completely emptied out last quarter. Really the pity is its easy to see these situations develop but hard to "sell short" a fad. If I knew how to sell fads short I'd be a billionaire.