| 1.) Market crash, where inflated valuations come back to earth and wipe out people who bought at the top. (See eg. Webvan) 2.) Long-term economic growth, where valuations stagnate for a while and earnings eventually catch up, and then we get another burst of more sustainable growth. (See eg. AMZN) 3.) Replacement, where the inflated asset completely replaces an industry or set of industries, takes all the cash flows of those companies, and keeps on rising quickly because of that. (See eg. GOOG or FB). 4.) (Hyper)inflation, where the value of the dollar falls rapidly, the asset's cash flows increase in nominal terms (because its real value remains constant), and then the cash flows eventually justify the asset's price and the asset starts rising again as those cash flows keep increasing. (See eg. Venezuela's stock market.) 5.) War or political unrest, where the system that these assets are embedded in collapses entirely and it's open season on whatever's useful in the wreckage (See eg. fall of the Soviet Union, WW2). For the assets you list: I'd bet on #3 for BTC and TSLA and #1 for GME, with a non-negligible chance of #4-5. |