April Fools' year

April 1 jokes expose greater fools of finance

April 1 delivered a timely reminder that financial fools abound. Tesla's attempt at humour by announcing the Tesla Model W, an obvious parody of Apple's forthcoming watch, caused its share price and trading volume to jump. Meanwhile, Tinder for Uber seemed all too feasible in a Silicon Valley littered with funding for oddball pitches. When investors can be easily duped, it's a good sign markets are high on hype and distortions.

The $24-billion electric car maker has been swept up in so much exuberance that even founder and Chief Executive Elon Musk has sometimes talked down his company's stock. Given that Musk also managed to make transport via rocket ship and hyperloop seem credible, it's no wonder markets overreact at the slightest sign of another bright idea. Tesla already had plans to unveil a mystery product on April 30, making trading fingers even twitchier.

It also was easy, at least for a moment or two, to buy into the idea of Tinder for Uber, a pairing of the smartphone dating app with the taxi-hailing service. There are so many start-ups with copycat "this-for-that" sorts of ideas in search of financing these days that a product designed to make love connections between customers and their drivers could easily be the real thing. Venture capitalist Fred Wilson wrote a cautionary blog post about such mash-ups last year.

On the other hand, some of today's innovation invites scepticism. Amazon, for example, had to emphasise that a new Wi-Fi-enabled gizmo that allows customers to order razors and washing powder at the touch of a button, unveiled on March 31, wasn't a prank.

Sometimes, however, the reality can become stranger than the spoof. Back in 2006, Breakingviews penned a farcical column urging the US Treasury to issue zero-coupon perpetual bonds. In today's world, investors willingly are paying money to governments like Germany's for the privilege of lending to them by accepting negative yields on the debt. Until the flood of cheap money can one day be dammed, pretty much every day will be April Fools' Day.