One interesting thing about those civilizations is that they were largely centralized, so the nation failing was roughly equivalent to society failing because supply chains and whatnot relied on central authority. These days with globalization, a large country can fail and the economic system keeps going. We’ve seen that happen (Germany in WW1, USSR in the 80s), and someone else so far has picked up the torch. So if the US fails, for example, someone else will have to step up (after a period of war and whatnot).
stock market… has to stop
Why?
Stock valuations are largely based on the market’s estimate of the value of the company, which takes into account future expected performance as well as current performance.
Tesla - #15 at ~1.3M vehicles (up ~400k year over year)
So Tesla sells less than a third vs Ford and less than seventh vs Toyota, yet it has double the valuation of both combined, what gives?
Tesla’s stock valuation is largely speculation, but it’s also based on the idea that Tesla will continue to grow its share of the market and profit as a function of dollars invested into the company, so more investment means more growth. Toyota has been pretty flat in total sales, and Ford is declining, so investing in either won’t likely be as profitable as investing in Tesla. In this case, it’s a simple question of supply and demand, more people want to buy than sell, so the price goes up. The idea is that, if Tesla continues its trajectory, it’ll eventually be worth that valuation when it shifts from growth to stabilization (i.e. pay a dividend instead of reinvesting in R&D).
That said, if Tesla hits a wall and can’t grow any more (or doesn’t grow as fast as investors want), investors will take their money elsewhere and Tesla’s stock price will tank. That wouldn’t cause the stock market to crash, it would just shift value from Tesla to wherever investors decide to go next.
Profit isn’t particularly important here, what’s important is growth and the prospect of future profit. If the company is heavily investing in growth, any excess beyond the cost of building products gets reinvested into the company to make more or better products, and that’s where you see either low or negative profit in rapidly expanding companies. Net profit is revenue minus costs, and R&D is often a massive part of those costs. When R&D slows, that money can be returned to shareholders via a dividend. We see that with large companies that don’t have much growth opportunity, like Coca Cola (spending more money on R&D won’t meaningfully increase soda sales).
There are lots of surprising valuations, but to say the market itself is completely made up is nonsense and leads me to believe you don’t really understand how it works. I’m happy to explain further if you have questions.