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The Investing Meltup: Understanding the Psychology of FOMO and TINA – 11/01/2025

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John Berkley and clinical psychologist Dr. Jim Burns analyze the psychological forces driving the current “expensive market” marked by high price-earnings (PE) multiples. The market is experiencing a “meltup”—an extraordinarily rapid price increase detached from valuations.
The key drivers are identified as FOMO (Fear of Missing Out) and TINA (There Is No Alternative), which pushed money into risk assets when interest rates were practically zero. Dr. Burns emphasizes that financial decisions are often emotional, contrary to traditional economic assumptions of investor rationality. Given the potential severity of the “backside” of a meltup, the hosts stress the importance of having and sticking to a disciplined investment strategy. Listeners are advised to understand their risk tolerance and manage expectations for future returns.

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