In my post titled “Money Tree,” I explained in a general way how the addition of “non-market money[1]” distorts market prices, which in turn leads to a misallocation of resources. In this post, I will build a hypothetical model to show how that process works in more specific conditions. I will follow two different market … Continue reading Crazy Markets
Month: February 2021
Developing the Money Tree
As an experiment I have posted (below) a video version of the diagram I used to develop the Money Tree Post. If this experiment works, I might use videos such as this (only a little slicker) to enhance the explanation of additional points related to free markets. https://videopress.com/v/9l7qqCXZ?resizeToParent=true&cover=true&preloadContent=metadata Let me know what you think of … Continue reading Developing the Money Tree
The Money Tree
We have seen a lot of craziness in the financial markets recently. A small group of investors, known as the Reddit investors, bid up several low-priced stock prices, squeezing short-sellers. Many people have applauded this activity depicting it as the small guy outsmarting the big guy — in this case, hedge funds. But, there is … Continue reading The Money Tree