I develop a general equilibrium model of investment and equity markets in which departures from the Efficient Markets Hypothesis generate “Casino Capitalism”: time-inconsistent, short-termist firm decisions, firm-level over-investment coupled with inefficient liquidation of positive-NPV projects, and aggregate under-investment with depressed stock prices and distorted intertemporal savings. These distortions arise even if all agents are fully rational and forward-looking. At the firm level, the wedge between market-implied and fundamental returns on investment causes an endogenous preference reversal that renders the Laissez-faire outcome time-inconsistent and Pareto-inferior. In the aggregate, firm-level attempts to boost stock prices are self-defeating via an aggregate investment wedge as micro distortions translate into macro inefficiency. Restoring firm-level rationality by empowering shareholders can worsen aggregate outcomes and precipitate a complete capital market shutdown.