Stocks

From here.

It is an open secret that the stock market in the U.S. is currently being driven by fewer than a dozen wildly overvalued tech stocks that account for the lion's share of it's growth (like the ones shown above, particularly Tesla and SpaceX).

The stock market is not particularly good at accurately estimating the true value of public held companies.

Inaccurate stock prices are an objectively bad thing at the level of the aggregate economy, because they cause investment capital to be misallocated. Too much money is allocated to investments that don't have as good of a likely return on investment, while too little money is allocated to investments that could produce better returns. And, since the stock market is huge, the economic consequences of these misallocations of investment capital on the economy are huge and negative.

Inaccurate asset prices also allocate personal wealth to people who hype their stocks to be worth more than they really are to stupid investors, basically, systemically creating immense returns to dishonesty.

Asset price bubbles aren't bad for everyone. There are two basic ways you can profit from them. One is to invest in the bubble asset despite knowing that it is overvalued, to ride its irrational surge in price, and to get out before the bubble pops. The other is to short the bubble asset and profit when the bubble pops, but this requires your short to be timed for when the bubble pops.

Why is the stock market so bad at pricing these stocks despite the fact that some of the smartest people in the country are employed to analyze and act on this data, and despite the fact that there is a lot of very good quality data about publicly held companies that can be used to value them accurately that is available?

One possibility is that a lot of investors in the stock market are on autopilot trading schemes, like index funds, that are free riding off the people who are actively trading individual stocks, that increasing numbers of ill-informed investors are actively trading individuals stocks as it has become easier to do so, and that the bad decisions of this dumb money is being amplified by autopilot trading.

Another explanation, not necessarily inconsistent with the first, is that this is a generational effect. Baby boomers are moving into their final years of employment and into retirement. They have immense stock market wealth. They are retired and bored, so they try actively trading individual stocks, and they are pouring money into the stock market that exceeds the extent to which stocks have reasonable values (as are individuals who save for retirement believing Social Security to be in peril and knowing that unlike Boomers, they have no defined benefit pensions). Due to the geriatric character of people with power who know what is going on, this is not a problem that they want to solve because they benefit from overvalued stocks in their retirement when they are living off of their investments. Political momentum for reform will come when the Boomers retire or when the bubble collapses, whichever comes first (and asset price bubbles inevitably collapse sooner or later even though the timing of when the bubble pops is notoriously difficult to estimate).

If the bubble sustains itself until the Boomers are mostly dead, the pain will be felt by Generation X and to a lesser extent Millennials (who will at least have more time to recover), in other words, by people like me.

My Picks In Colorado's 2026 Democratic Primary

A colleague of mine has worked as an attorney for both Hetal Doshi and Mike Dougherty, and tells me that while both have done a good job and are competent, that Hetal Doshi is the better leader of a larger organization like the AG's office and would do a better job. Jena Griswold has been a great SOS, but is not a seasoned lawyer with the expertise managing lawyers needed to be effective in the AG's office even though her heart is in the right place.

I prefer Amanda Gonzales, the clerk and recorder of Jefferson County, over Jessie Danielson, a former two term state senator and election law activist, because the SOS calls for administrative competence (which Amanda Gonzales has displayed) and not quality legislative innovation (which is where Danielson excels).

Congresswoman Diana DeGette has performed much better than John W. Hickenlooper and Michael Bennet in Congress (both of whom lead the U.S. Senate Democrats in supporting Trump, and have disappointed on some key issues before Trump 2.0, and have not been very active advocates) but is coasting, didn't advance very impressive bills when she had the chance, and in general, is not being as effective as she could be. DeGette's seniority also doesn't matter much when Trump is still President, limiting what that means in the next two years, and it is time to pass the baton to a new generation of leaders. Melat Kiros has a lot of passion, but isn't very accomplished and hasn't proven herself. Wanda James, whom I've spoken to personally and didn't immediately support when it didn't seem like she had a viable chance in the political climate at the time that I did, in contrast, has proven herself in both business and politics, and has more fire in her belly than DeGette does.

Phil Weiser is the obvious choice over Senator Bennet for Governor. Bennet did not distinguish himself as Denver Public Schools Superintendent, and has done a mediocre job as U.S. Senator, while Phil Weiser has risen to the challenge is resisting Trump vigorously and effectively as AG.

John W. Hickenlooper despite having done an excellent job as Mayor of Denver, and a decent enough job as Governor, has done a mediocre job as U.S. Senator and doesn't deserve another term. Julie Gonzales won't be one of the biggest Trump supporters in the Democratic Caucus in the Senate, and will be more pro-active in advancing federal legislation that moves the country in the right direction.

The highlighted candidates are my picks. There are four state legislative races in Denver where I currently don't know enough to make a pick (and probably won't, because I don't live in any of those districts).