Some rich guy paid about 150 million crowns for a banana taped to the wall. It wasn’t just any banana, because it had been hanging in a gallery for five years, but still…
Is this proof that madness is spreading? I don’t think so. It’s more evidence that there is a group of people with astronomical fortunes who have acquired them through speculation and know nothing else but to continue speculating. And they don’t have anything to invest it in. The banana shows well the basic investment strategy – I don’t think and I’ll put my money into anything. I have so much of it that I don’t mind losing it. And one out of 10 or 50 investments will make huge money. Then the guy gives newspaper interviews and marvels at what an amazing talent he is. In fact, he’s shown comparable talent to someone else buying a lottery ticket.
More capital than productive industries can use. That’s the problem. A consequence of the states’ inability to find the right level of taxation and enforce it (or, at times, apply Piketty’s concept of the “confiscatory tax.” And it leads to far worse things than overpriced bananas on the wall.