I would say based on consensus. That’s how we determine it in real life (stocks, real estate, market values). If there’s one person in the world who would pay $1,000 for Swift’s shit, then that person just doesn’t know the value of it, because most people wouldn’t pay anything for it. I’d imagine most people would pay not to have it.
If I trick you into paying money for something by telling you it’s super valuable, I’m ripping you off, I’m not increasing the value of the item.
The consensus of who? Everyone? Because how does society determine the value of, for example, an MRI machine when most people have no idea what it could be worth?
The whole concept of the game show The Price is Right is that most people don’t know how much anything costs.
The consensus of the market. Prospective buyers. People can still buy things that are overvalued, but when the market is exerting pressure on you to lower its price, you know it’s overvalued.
The market? Weird, because I’ve seen a lot of complaints that things like houses are priced too high to be affordable. And yet by your metric, their value is the correct one because the market has decided so. Is that really what you think?
Isn’t that how value works?
That’s how ripping someone off works.
So how is value determined?
I would say based on consensus. That’s how we determine it in real life (stocks, real estate, market values). If there’s one person in the world who would pay $1,000 for Swift’s shit, then that person just doesn’t know the value of it, because most people wouldn’t pay anything for it. I’d imagine most people would pay not to have it.
If I trick you into paying money for something by telling you it’s super valuable, I’m ripping you off, I’m not increasing the value of the item.
The consensus of who? Everyone? Because how does society determine the value of, for example, an MRI machine when most people have no idea what it could be worth?
The whole concept of the game show The Price is Right is that most people don’t know how much anything costs.
The consensus of the market. Prospective buyers. People can still buy things that are overvalued, but when the market is exerting pressure on you to lower its price, you know it’s overvalued.
The market? Weird, because I’ve seen a lot of complaints that things like houses are priced too high to be affordable. And yet by your metric, their value is the correct one because the market has decided so. Is that really what you think?
That may be a case of something being overvalued. That can especially happen when there is artificially limited supply.
I thought you said the market determined the value.
So who determines if something is overvalued?