Where did the money actually go? Are these small startups or individuals that have gone bankrupt that totalled this amount ?
In: Economics
When a lot of people believe that your worth a lot of money, they can inflate your value. Say you decided you wanted to to take a $18,000 loan against your self value when it was worth $100,000. Banks would be like “Oh heck ya, we know you’re gonna pay that back cause everyone believes you are worth way more than that!” But then you wrote something on X and no one liked it, and your value dropped to 1,000. Do you think a bank would still give you a $18,000 loan if they knew you were only worth $1,000? Probably not because they would then say “If I give you $18,000 I’ll never get that back with interest because you are only worth $1,000. I would lose money on you”
In truth, it’s about perception that someone else can “Bet” that they will make money off you. If you’re value is diminished, it means the existing loans or stocks or positions will pay out less. So people who put their confidence in You is wiped out, along with their potential profits.
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