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The economics of meme stocks

If you want to understand meme stocks, think about clock towers, celebrities and viruses
The economics of meme stocks
  • Meme stocks might be new in stock markets but are part of old economic phenomena
  • Just because we can explain boom-bust cycles in such stocks does not mean that we can accurately predict them. 

If you want to understand one aspect of markets today, you should forget Benjamin Graham and recall another mid-20th century US economist, Thomas Schelling.

I say so because of the phenomenon of meme stocks – shares such as GameStop or AMC which soar as small investors pile in only to plunge later.

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