Speculation - in which the focus is not on what an asset will produce but rather on what the price will do or what the next fellow will pay for it - is neither illegal or immoral. But it is not a game that will be glamorized or given any importance on my blog. Like the saying goes "We bring nothing to the party, so why should we expect to bring anything home?"
The line seperating investment and speculation, which is never bright and clear, becomes blurred still further when most market participants have recently enjoyed triumphs. Nothing sedates rationality like large doses of effortless money. After a heady experience of that kind, normally sensible people drift into behaviour akin to that of Cindarella at the ball. They know that overstaying the festivities - that is, continuing to speculate in companies that have gigantic valuations relative to the cash they'r likely to generate in the future - will eventually bring on pumpkins and mice. But they nevertheless hate to miss a single minute of what is one helluva party. Therefore the giddy participants all plan to leave just seconds before midnite. There's one problem, though: They'r dancing in a room in which the clocks have no hands.
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