Either expectations of future income, or present circumstances.
Stocks are also used like a currency in mergers which seems odd but is practical in some circumstances.
Stocks and currency can both become most valuable as TP or wall paper.
The wilds swings in exchange rate is typical of any new currency, even the USD in its early years.
Did the stock market value drop by 50% in the past couple of weeks?
Because BTC has doubled. If you're saying "BTC's price is the fundamental measure" of our economy, then it means we're in a horribly deflationary spiral right now.
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Alternatively, it means that BTC is in a bubble and maybe we can't price things in terms of BTC, because BTC is a horribly volatile asset that almost has no rhyme or reason behind its price movements.
But if the stock ever crashed to say: the value of the expected dividend... it would make more sense to pay out the dividend rather than invest.
Lets say a company's stock price is $40, and they make $2 per stock of profit one year. They can give out the dividend... or... they can reinvest the money into the company (and theoretically: if the stock market reacts correctly, it would raise the price of the stock to $42).
In contrast: if the stock market fails to react like this, eventually the company will be say: $2 per share. They'll still be making $2 in profits each year however (assuming the fundamentals haven't changed). At this point, it makes sense to pay out a dividend of $2, if their stock price doesn't react.
After all: might as well double your money each year at that point. (Take those $2 dividend, then double your number of shares in the company, then receive double the money next year).
https://www.marketwatch.com/story/companies-on-pace-to-penci...
Sure: securities can go up, or down, in price almost arbitrarily. But they largely can't go below zero (aka: bankruptcy law protects against that), and they can't really go below the expected profits of the company (because shareholders are entitled to those profits. Worst-comes-to-worst, the shareholders can demand dividends and cash out through those means)
A lot of companies are 20x or 30x, or more of their expected profits (representing maybe 20 years of profits is roughly the fair price for a typical company's stock price). There are exceptions, especially in growth stage companies (where "profits" is now "expected profits" of the far future: the shareholders believe the company is onto a good idea and are willing to pay more on the hopes that the company becomes very large in the future).