Stock psychology: Learning model
Why it's called "Learning model"? Because people can get suggestions easily and will LEARN
from the history and think the same thing will happen again. In the stk. mkt., the situation is apparently seen. It has some unique features: 1.One publicly-traded co. will provide suggestions(amazing revenue no, or future growth opportunities...or even no obvious suggestions)or maybe the public will assume something with mistake. 2.It will show apparently that everyone can benefit from that. 3.The probability of that is very high. 4.Everyone gets the wrong suggestion; yet no one finds out. This not only happens in the stk. mkt., but in life.
The effect can be enormous. In the early phase, everyone is satisfied with the stk. In the second phase, some clever people sense something wrong and get out quickly. In the last phase(maybe it prevails for several months) anyone inside will get cheated and can't pull back most of the money from the stk but still some people don't believe it and claim what they think as truth.