10 rules about economic bubbles you need to know
DESCRIPTION
The Fed is creating one bubble after the next by its policy of pushing down short-term and long-term interest rates. We've studied all the bubbles in modern history. Here are 10 rules about bubbles that you must know to fully understand the situation our economy is facing.TRANSCRIPT
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All growth, progress and evolution is exponential, not linear.
2
not incremental.
All growth is cyclical,
the greater the burst.The greater the bubble,
Bubbles always burst. There are no exceptions.
a bitlower.
or
Bubbles tend to go back
to where they started
6Financial bubbles tend to get more extremeover time as credit availability expands along
with our incomes and wealth.
Bubbles become so attractive…
that they eventually suck in even the skeptics.
No one wants the “high” and easy gains of the bubble to end
so everyone goes into denial, especially in the latter stages.
Major bubbles only occur about once in a
human lifetime, so it’s easy to forget the lessons
from the last one…
The last bubble burst of this magnitude was from 1922 to 1929:
The Great Depression.
Bubbles may seem fruitless and destructive when they burst, but they actually serve a very essential function
in the process of human innovation and
human progress.
There you have it.
So the next time someone tells you we’re not in a bubble right now,
slap them and then show them this presentation.
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Harry Dent