Quote:
Originally Posted by red-beard
There was a WSJ article which basically showed that most of the "bubbles" were not a problem until people started borrowing money to invest. Once you start getting a bubble of debt, that is the point to be scared.
We've had the internet bubble, the housing bubble, now we are in the final stages of the government bubble.
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though still very early into my research into banking & trading, it would seem that cheap money is a requirement for asset hypervaluation. it's interesting that folks that would otherwise be considered sophisticated investors are herded through multiple cycles of debt/borrowing based against the original assets until they're over-leveraged by over 30X original value, which was inflated to start.
the actual trigger though, what pushes that price up at the very beginning?