Aging & Wisdom Quote by George Soros

Bubbles, Soros insists, aren’t mass hallucinations. They’re reality with a funhouse mirror. That framing is pure Soros: the market isn’t a spreadsheet reflecting objective value, it’s a social arena where beliefs, incentives, and narratives loop back and reshape the “fundamentals” they’re supposed to merely describe. The sly bite is in the phrase “solid basis in reality” paired with “distorted by a misconception.” He’s puncturing the comforting idea that speculation is simply irrational froth floating above a stable economy. The froth attaches to something real: a technology shift, cheap credit, a policy regime, genuine growth. Then a misconception - often small at first - gets institutional backing, media oxygen, and financial engineering, until it stops being a mistake and starts behaving like a temporary truth.

The intent is diagnostic and self-implicating. Soros made his fortune trading on mispricings, yet he’s warning that markets systematically produce them, because participants don’t just observe conditions; they influence them. That’s the subtext of his “reflexivity” worldview: rising prices validate the story, attract capital, expand balance sheets, and make the story truer for a while. The distortion becomes reality’s co-author.

Context matters: Soros is speaking as a practitioner who watched late-20th-century finance turn expectations into leverage at scale - from the 1980s boom-bust cycles to the dot-com era and beyond. The line functions as both critique and field manual. If bubbles have real roots, you can’t puncture them with smug rationalism; you have to understand the misconception powerful enough to reorganize the world around it.