ShmoopTube

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Finance a la shmoop what is the greater fool theory? Oh shiny rocks, tulips,

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Bitcoin.....The basic idea in the greater fool theory is

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that you're a fool I'm a fool were all fools in the mosh pit [Man standing in a moshpit]

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right here and we've all done and will continue to do stupid things like paying

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$7,000 for a tulip one that just um you know sits there it doesn't speak it

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doesn't divine the future just sits there nor does it guarantee lifetime you [Man eating a tulip]

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know sexual prowess if you eat it it doesn't even reproduce in a particularly

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virile manner, it's just a tulip well a short term store of wealth that one fool paid

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7 grand for making the big bet that there's another fool even more motley

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foolish who will pay 8 grand and in Holland a few hundred years ago there

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was one clapping wooden shoe wearing blond paid 9 grand for this tulip and [Man carrying tulip]

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then another even greater fool paid 10 grand and then another fool paid 11

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grand and so on until this most foolish of all tulips sold for $26,000 then what

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there another fool well no there wasn't then the flower stopped selling for

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$26,000 and probably ended up selling for about 26,000 cents yeah there were

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no more fools even greater than the ones that came before so the price plummeted [Person removes price label of tulip]

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back to I don't know what was it 4 cents a tulip actually sold for for a normal

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tulip back then it's about what it was intrinsically worth and well that was

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all she wrote or germinated or whatever the greater

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fool theory posits that there is always a greater fool out there to buy your

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stuff at a higher and higher price until there isn't a greater fool out there

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yeah it's sort of the game of hot potato where you benefit only by holding the [Woman and man juggling a hot potato]

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potato usually a very short period of time before dumping its finger burning

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love on to someone else who's foolish enough to catch it and the greatest

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thing about the greater fool theory... Well we're a planet with lots and lots and

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lots of fools...

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