Originally published at: https://boingboing.net/2017/12/29/scandal-plagued-monsters.html
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Please… Quit using vintage bad illustrations ot the Lusitania sinking to illustrate your point…
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Is anybody else hearing the song for Hot Potato playing?
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Something is worth what others are willing to pay for it. No more, no less. Its share valuation is only an illusion to the extent that all shares and indeed all money is an illusion. But it’s not really an illusion, except to those who don’t understand how trade value operates, because most people know all money is a matter of belief and all trade is a matter of whether anyone will buy what’s sold at what price.
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Too soon?
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That isn’t entirely true. If I find someone willing to sell something to me super cheap, and turn around and sell it for much more, obviously that items worth was undervalued by the first seller.
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Strictly speaking its value was underestimate by the seller. The value was always whatever the highest bidder would pay for it. The price is what it goes for. The value is what it could go for. But I take your point and it’s a clarification worth making.
It’s okay, we little guys will snap up those shares and all get rich! It’s like that time Jed Clampett was shootin’ at some food, when up through the ground came a-bubblin’ crude!
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Wondering what % of those sales were immediately shifted to crypto.
If the company was publicly traded, yes, absolutely.
But as it isn’t I just see it as a sign of over valuation in the minds of employees. This won’t affect their stock price, because it isn’t publicly traded and a tender deal takes away the stigma of insider selling even so.
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That doesn’t invalidate the statement. “Others” can both relate to an individual buyer-seller pair, as well as “the market” at large, which is an amalgamated set of buyer-seller transactions.
That depends on the time and effort it requires to resell.
If someone “needs” cash right away and sells an item for $800 that you advertise on craigslist (or somewhere) for $1000, and 3 days later get the $1000 (less whatever percentage your advertising cost) the original seller still wasn’t undervaluing the item…they just needed to raise cash in a hurry, while you had the luxury of time. Also they may just hate dealing with craigslist/eBay/whatnot and be happy to leave $200 on the table to not have to deal with all that.
On the other hand, sure, if they sell you something highly liquid that you immediately resell at a higher rate (stock certificate, or foreign currency), then yeah they undervalued it (or know it was stolen and want to dump it on a sucker, er, you).
Perhaps the best way to think of value is to recognize that there is no such thing as universal value. Value is a very personal thing. If something is sold at under value, that only means that the object sold had less value for the seller than it did for the observer.
The only reason we talk of value as something global is because we do not trust our own estimations of value. So we build up an average opinion of value. And even that opinion can be volatile.
All of this to say that Uber has no value whatsoever for me, so rich people playing games with what they believe Uber’s value to be is mere spectator sport for me.
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