The FOMO Economy
Bloomberg Businessweek|June 14, 2021
From AMC to Dogecoin to houses, buying seems driven as much by anxiety as by hope
Pat Regnier

Billionaire trader and investor Stanley Druckenmiller bought Bitcoin after watching its price go up and feeling the fear of missing out, aka FOMO. “I felt like a moron,” he said in an interview with the online news site the Hustle in May. He cashed out part of his $20 million bet after prices soared—“my heart’s never been in it”—but described the stampede of money managers into the cryptocurrency as an elephant trying to fit through a keyhole.

Druckenmiller has felt the FOMO before. In 1999 he loaded up on $6 billion worth of tech stocks, only to lose $3 billion in six weeks. “I was just an emotional basket case, and I couldn’t help myself,” he said years later. This time around, he looks more like a bellwether for a broader kind of investor panic-buying in developed economies after a bruising pandemic year. We are all Stanley Druckenmillers now.

It’s not just crypto: It’s stocks such as those of AMC Entertainment Holdings, GameStop, and Tesla that are beloved on Reddit and Twitter, and it’s the houses and condos being snapped up almost as soon as they list. The pressure to keep up with neighbors, friends, and social media meme lords who seem to be in the process of becoming extremely wealthy—or, at least, talking about it—can feel unbearable. It’s only human, and, as Druckenmiller’s example shows, it’s not something only small investors and novices feel. Telecommunications companies overinvested like a thundering herd in the 1990s, and a lot of them went bust in unison as a result. In the early 2000s, few bankers were willing to tap the brakes on increasingly risky and baroque mortgage investments.

Today, a new generation of stock traders has known market crashes only as short-lived dip-buying opportunities, leading to a record rise in brokerage account openings. Rock-bottom interest rates have fueled big profits on flipping real estate— some $66,000 on average per home, according to research firm Attom Data Solutions. People flush with pent-up savings after a year of lockdowns have more ways than ever to throw darts at the financial dartboard: zero-commission, zero-minimum trading apps; social media message boards; and exchange-traded funds you can hop in and out of as easily as stocks, including a few that explicitly play to the trend-chasing crowd with such tickers as BUZZ and, yes, FOMO.

Continue reading your story on the app

Continue reading your story in the magazine

MORE STORIES FROM BLOOMBERG BUSINESSWEEKView All

Bitcoin of the Realm

What happened when a surfing town in El Salvador went full crypto

10+ mins read
Bloomberg Businessweek
June 21, 2021

Nasdaq. NYSE. SushiSwap?

Decentralized finance uses crypto to build a new, unregulated kind of market

5 mins read
Bloomberg Businessweek
June 21, 2021

Yangonomics 101

Whether or not he becomes New York’s next mayor, Yang has brought his signature idea—to just give people money—into the political mainstream

10+ mins read
Bloomberg Businessweek
June 21, 2021

A One-Hit Wonder Looks for No. 2

Niantic teams up with Hasbro and Nintendo to find life beyond Pokémon Go

5 mins read
Bloomberg Businessweek
June 21, 2021

Working Abroad Is Easy. Taxes Aren't

More companies make remote work a job perk, but that can mean a paperwork nightmare

4 mins read
Bloomberg Businessweek
June 21, 2021

This Will Blow Your Mind

WITH KERNEL, BRYAN JOHNSON IS BETTING $110 MILLION THAT ACTIVELY MONITORING OUR BRAIN ACTIVITY WILL HELP US ALL LIVE BEYOND OUR YEARS. HE’S STUDYING EVERYTHING ELSE IN HIS BODY, TOO

10+ mins read
Bloomberg Businessweek
June 21, 2021

Latin America Turns on The Establishment

Pedro Castillo’s victory in Peru signals a regionwide fury at incumbents, a boon for the left

6 mins read
Bloomberg Businessweek
June 21, 2021

AIRBNB HAS A NIGHTMARE PROBLEM

WHEN VIOLENT CRIMES HAPPEN DURING STAYS, THE COMPANY’S SECRETIVE SAFETY TEAM IS CALLED ON TO SOOTHE GUESTS, HELP FAMILIES—AND PREVENT PR DISASTERS

10+ mins read
Bloomberg Businessweek
June 21, 2021

A Bittersweet Homecoming

Filipino migrant workers repatriated during the pandemic face a dearth of job opportunities

4 mins read
Bloomberg Businessweek
June 21, 2021

Young U.S. Jews Shift on Israel

Millennial and Gen Z progressives question American support of Israeli policies, a point of tension for the Democratic Party

4 mins read
Bloomberg Businessweek
June 14, 2021
RELATED STORIES

AIRBUS-BOEING DEAL EASES US EU TENSIONS BUT CONFLICTS REMAIN

The deal the United States and the European Union reached this week to end their long-running rift over subsidies to Boeing and Airbus will suspend billions in punitive tariffs. It will ease trans-Atlantic tensions. And it will let the two sides focus on a common economic threat: China.

5 mins read
Techlife News
Techlife News #503

AMAZON ALLOTS $300 MILLION FOR HOUSING NEAR MASS TRANSIT

Amazon is providing $300 million in low-interest loans to support housing located near mass transit in the Washington, D.C., area and the Seattle and Nashville, Tennessee, regions.

1 min read
Techlife News
Techlife News #503

CAN YOU MIX AND MATCH COVID-19 VACCINES?

Can you mix and match two-dose COVID-19 vaccines?

1 min read
Techlife News
Techlife News #503

INTERNET OUTAGES BRIEFLY DISRUPT ACCESS TO WEBSITES, APPS

A wave of brief internet outages hit the websites and apps of dozens of financial institutions, airlines and other companies across the globe Thursday and Friday.

2 mins read
Techlife News
Techlife News #503

CASSILL TO BE PAID IN CRYPTOCURRENCY IN DEAL WITH VOYAGER

Landon Cassill will be the first NASCAR driver paid entirely in cryptocurrency in a sponsorship deal with Voyager that begins at Nashville Superspeedway this weekend.

2 mins read
Techlife News
Techlife News #503

THE SIGNIFICANCE OF CHINA'S NEW SPACE STATION

Adding a crew to China’s new orbiting space station is another major advance for the burgeoning space power.

3 mins read
Techlife News
Techlife News #503

HONG KONG WATCHING CHINESE NUCLEAR PLANT AFTER LEAK REPORTED

China’s government said Tuesday no abnormal radiation was detected outside a nuclear power plant near Hong Kong following a news report of a leak, while Hong Kong’s leader said her administration was closely watching the facility.

4 mins read
Techlife News
Techlife News #503

‘A SUMMER OF FREEDOM': VACCINE GIVES NEW MEANING TO JULY 4TH

President Joe Biden wants to imbue Independence Day with new meaning this year by encouraging nationwide celebrations to mark the country’s effective return to normalcy after 16 months of coronavirus pandemic disruption and more than 600,000 lives lost.

4 mins read
Techlife News
Techlife News #503

SELF-DRIVING CAR PIONEER WAYMO GETS $2.5B TO FUEL AMBITIONS

Waymo, the self-driving car pioneer spun off from Google, isn’t allowing a recent wave of executive departures to detour its plans to expand its robotic taxi service.

1 min read
Techlife News
Techlife News #503

LOUISIANA CREATES RULES FOR SELF-DRIVING DELIVERY DEVICES

Louisiana has created a framework for self-driving delivery robots to drop off packages on the state’s streets, under a bill backed by lawmakers and Gov. John Bel Edwards.

1 min read
Techlife News
Techlife News #503