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Alpha3031 5 hours ago

Traditionally, the value of a security is a prediction of its future cashflow to perpetuity discounted by a capitalisation rate. While it is true that some securities these days are sold as something not dependent on future cash flows, and insiders are paid off by selling something misleading to retail investors, that is known as a Ponzi scheme and is traditionally prohibited by securities regulations.

skybrian 4 hours ago | parent [-]

Predictions aren’t physical and can be wrong.

Alpha3031 4 hours ago | parent [-]

There is nothing physical about any financial transaction (except some electrons moving I guess), that doesn't mean that they aren't supposed to approximate something that happens in physical reality. A billion dollars is control.

skybrian 4 hours ago | parent [-]

Yes, the transactions are real, but trades are based on speculation and market cap is an extrapolation of much smaller trades.

The transactions are just as real for Bitcoin or a meme stock.