What makes the difference between the wisdom of crowds, and the madness of the mob?
How do you know that something is correct, just because many people believe it?
Where do you draw the line between crowd-sourced wisdom, and popular delusion?
I don't know the answers here, I am just intrigued by the questions, and I was struck by this quote from
"The key to such widespread phenomena (as financial bubbles) lies in the nature of the crowd: the way in which a collection of usually calm, rational individuals can be overwhelmed by such emotion when it appears their peers are behaving in a certain universal manner. ... At its fundamental level, this fear of being left out or failing when your friends, relatives and neighbors seem to be making a killing, drives the overwhelming power of the crowd.
"Another motivating force behind crowd behavior is our tendency to look for leadership, in the form of the balance of the crowd's opinion (as we think that the majority must be right) or in the form of a few key individuals who seem to be driving the crowd's behavior by virtue of their uncanny ability to predict the future. In times of uncertainty we look to strong leaders to guide our behavior and provide examples to follow. The seemingly omniscient market guru is but one example of the type of individual who purports to stand as all-knowing leader of the crowd, but whose façade is the first to crumble when the tides of mania eventually turn".