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Author Topic: Greater Fool ...  (Read 1597 times)

jeremypayne

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Greater Fool ...
« on: December 20, 2012, 02:37:20 PM »

There was a reference in another thread to the Greater Fool.

For the record, this was referenced improperly ... it was stated that Greater Fools "...took the unconventional road and made it work for them.  When everyone looked right, they turned around and looked left. They are realists, dreamers and explorers all rolled into one."

This is not what is generally meant by the Greater Fool Theory.

The Greater Fool Theory states that it is "OK" to make a stupid investment as long as you believe there will be a "greater fool" down the road who will buy it from you at a higher price.

It has nothing to do with innovation, risk taking or thinking outside the box.
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Rob C

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Re: Greater Fool ...
« Reply #1 on: December 20, 2012, 04:05:48 PM »

Is that the principle behing Ebay, or whatever it's called?

Rob C

jeremypayne

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Re: Greater Fool ...
« Reply #2 on: December 20, 2012, 04:09:11 PM »

Is that the principle behing Ebay, or whatever it's called?

Not at all.

It is the principle behind phenomena like the late 1990's internet bubble in the stock market.
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Jim Pascoe

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Re: Greater Fool ...
« Reply #3 on: December 21, 2012, 02:51:13 AM »

Is that the principle behing Ebay, or whatever it's called?

Rob C

That's a good one Rob!  I met a photographer the other day who says he spends a lot of time on e-Bay buying cameras, and his wife spends a lot of time on e-Bay selling them.

Jim
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Justinr

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Re: Greater Fool ...
« Reply #4 on: December 21, 2012, 04:19:21 AM »

That's a good one Rob!  I met a photographer the other day who says he spends a lot of time on e-Bay buying cameras, and his wife spends a lot of time on e-Bay selling them.

Jim

But how much time is required to spend it, a lot, or will a quick call to the pizza shop clean them out?
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Jim Pascoe

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Re: Greater Fool ...
« Reply #5 on: December 21, 2012, 04:24:15 AM »

But how much time is required to spend it, a lot, or will a quick call to the pizza shop clean them out?

Justin, I have re-read that several times, but I cannot work out what you are saying.  Or am I just being thick?  I have been working a lot of hours lately!

Jim
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Justinr

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Re: Greater Fool ...
« Reply #6 on: December 21, 2012, 06:26:28 AM »

Justin, I have re-read that several times, but I cannot work out what you are saying.  Or am I just being thick?  I have been working a lot of hours lately!

Jim

I assume that he is buying, she is selling and there is some sort of margin, well that's how I read it anyway. Curiosity led me to wonder about the scale of said margin, a shopping trip to Dubai or a dial up pizza?  :)
« Last Edit: December 21, 2012, 10:48:12 AM by Justinr »
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Jim Pascoe

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Re: Greater Fool ...
« Reply #7 on: December 21, 2012, 12:14:59 PM »

I assume that he is buying, she is selling and there is some sort of margin, well that's how I read it anyway. Curiosity led me to wonder about the scale of said margin, a shopping trip to Dubai or a dial up pizza?  :)

Ah!  No, he's a camera enthusiast and cannot help himself buying, but his wife knows they can't afford all the cameras and so sells them on.  I'm not sure they actually profit from the exercise in their case.

Jim
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Slobodan Blagojevic

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Re: Greater Fool ...
« Reply #8 on: December 21, 2012, 01:07:49 PM »

It is the principle behind phenomena like the late 1990's internet bubble in the stock market.

Or the latest mortgage crisis. Even the masters of the universe did not mind being foolish buying them, as they expected to sell them to the greater fool.

dmerger

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Re: Greater Fool ...
« Reply #9 on: December 21, 2012, 03:35:11 PM »

Effectively, they did find a greater fool, the U.S. taxpayers!
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Dean Erger

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Re: Greater Fool ...
« Reply #10 on: December 21, 2012, 04:22:03 PM »

Effectively, they did find a greater fool, the U.S. taxpayers!

I once read somewhere: never underestimate the power of stupid people in large groups.
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Oscar Rysdyk
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dmerger

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Re: Greater Fool ...
« Reply #11 on: December 21, 2012, 05:09:21 PM »

Your correction is of course correct, Oscar.  I guess I was just showing my parochial view.
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Dean Erger
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