LOL... who and where it goes... Personally, Angelina Jolie and Jolene Blalock's two lips would be something I would really think about....
Who would buy a tulip 1 million dollar today ? Well, if it were in a strong uptrend, most of the people here...that's who. Sad but true.
Valuation means squat. Timing is everything. The whole point of investing is essentially to get the dividend payout (traditional valuation). Thus one would NOT invest in the stock market considering that the divident ratio has historically not justified the additional risk to be taken.
Harry Very simply the same people who bought zero worth new economy corporations at incredible prices. What the tulip story teach is -IMHO- that rally are "phisiological" mass movement. No matter what you sell but if is well advertised ( and Tulip were because they had the firts catalog designed of plants in the history drawn by dDutch artist and published in Germany) and you got so called " expert" consigliori you are "au cheval".
Yah I agree with you that it is hype. It is not that astonish me. What astonish is the level of complicity of people themselves because they prefer short term interest and not long term interest because they think they are more intelligent than their neighbours without thinking that their neighbours exactly think that they are more intelligent also than them and that at the end they will be able to escape the global final results which only occur dozens of years later (we don't have dozens of years anymore today since these dozens of years have passed already since 1929) but when it occurs everybody is touched in fact like in 1929 it is not the poors that are touched first it is the so called "rich" who were possessing firms and assets and who can't sustain any more the crisis when that kind of things finally happen. And it is when the rich lost their assets that the rest of people will lose their jobs and are then affected also. I personally know people who think they are rich whereas they have huge credits for dozens up to hundreds of millions for real assets that some of them are totally ignorant of economical laws and one day it will happen something nasty for them. It has even already happened for some idiots in my own branch family and I won't cry for those idiots and above all cupids. People just live the present, some are even mystic to think that they must not think that bad think could happen because they will attract it. This is completely stupid it is ignorance of law of causality. Even in mysticism law of causality is there and it is not by just thinking to bad eventualties that these would happen, it is by ignoring and so fearing it that these bad things will happen. By fearing them, you ignore them, and so don't ACT to prevent them. The importance is ACTING not just thinking. Again it is the so called PDCA cycle of progress that I want to refer as a philosphy of ACTION and not just passivity.
I'm not talking about individual strategy. I am talking about global behavior. I am talking about the cupidity of those who know and publicize the hype, about those who prefer to hear these hypes than the truth or who pretend to ignore the truth but when they are catched then pretend they ignore, so I talk about the global comedy of the whole people, whereas at the end the whole will lose. The only rational reason I see is that they don't have any experience of the big catastrophe a bit like the WTC except that it will be global (I don't speak for terrorism I speak for economical catastrophe) so it is abstract for them, they don't see the consequences for their day to day life of them and their children in the future, and when it will occur they will regret even the few that will have made gain because they will probably lose all these gains and more when it will occur as it happened in 1929. That's one of the reason industrial assets are today possessed by less people and have been more concentrated than ever into a fewer hands. I know that it is nothing new even under the romans heavy speculation on bonds government and equivalent of options today already exists so the "modern" market has invented nothing. They just exploit the fact that each generation just forget above all when history is so badly occulted at school and distorted in medias. But all the same since the romans and even before there have been some millenars and still society behave as barbarian as the ancient age with a more sophisticated appearance but fondamentally it didn't evoluate much.
It depends on your time frame, but valuation DOES matter. If you want to scalp a few dollars today from some frothy daytrader buying, that's great - you can probably do that. The more certain outcome is that any company trading at a very high price that does not make (and will not make) money will drop in price. That is a certainty as no business has ever lost money year after year and continued to trade at a high multiple/price.