Quote:
Originally Posted by Billy5858
5 pages of comments equals bubble
Look where they ain't
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+1
Did a little research into market bubbles. This seems about right:
Behavioral finance theory attributes market bubbles to cognitive biases that lead to groupthink and herd behavior. Other theoretical explanations of market bubbles have suggested that they are intrinsic and contagious.
Emotional and cognitive biases seem to be the causes of bubbles, but often, when the phenomenon appears, pundits try to find a rationale, so as not to be against the crowd. Thus, sometimes, people will dismiss concerns about overpriced markets by citing a new economy where the old valuation rules may no longer apply. This type of thinking helps to further propagate the bubble whereby everyone is investing with the intent of finding a greater fool. Still, some analysts cite the wisdom of crowds and say that price movements really do reflect rational expectations of fundamental returns. Large traders become powerful enough to rock the boat, generating market bubbles.