&gt; The market cap valuation works in exactly the same way.<p>No it doesn&#x27;t, not in a functioning public market.<p>Just because the guy claims the cats are $500,000 each, doesn&#x27;t actually make it so. The sole thing occurring there, is a person is claiming something (that is obviously false). No taxing authority on the planet would assess those cats at $500,000; no professional auditing firm would either. The entire bogus premise collapses instantly upon scrutiny.<p>In almost any market, a claim is worthless unless you can eventually cash it in for a large portion of that sum, typically in a currency that possesses real value. In your example, your cats can never be cashed in for a meaningful fraction of their proclaimed value under any scenario. I can sell my Tesla stock however, there is an extremely well established and accepted value placed on it. I can still pretend, and make an outrageous claim on what my Tesla stock is worth ($1 trillion!), however it is nothing more than a bogus claim and has no actual bearing on reality.