What a weird question, you may think. But consider:
- In textbook markets, what is traded are products that are supposedly useful to customers. What is traded in many financial markets are highly artificial contractual arrangements that are several layers away from what happens in the real economy.
- In textbook markets, participants are liable to go bankrupt if they overspend. In financial markets, some market participants know that they are too big to fail, creating problems of “moral hazard.”
- In textbook markets, participants are expected to inform themselves about the products they trade. At least in some financial markets, what matters are not the “fundamentals” (e.g. the economic success of a company the shares of which are traded), but what other participants do. Many participants try to make profits by outrunning market movements or “sentiments”; this can lead to large swings, in disconnect from fundamentals