{"id":38154,"date":"2018-09-23T05:57:27","date_gmt":"2018-09-23T10:57:27","guid":{"rendered":"http:\/\/olduvai.ca\/?p=38154"},"modified":"2018-09-23T05:57:27","modified_gmt":"2018-09-23T10:57:27","slug":"what-really-makes-a-bubble","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=38154","title":{"rendered":"What Really Makes A Bubble"},"content":{"rendered":"<div id=\"block-zerohedge-page-title\" class=\"block block-core block-page-title-block\">\n<h3 class=\"page-title\"><span class=\"field field--name-title field--type-string field--label-hidden\"><a href=\"https:\/\/www.zerohedge.com\/news\/2018-09-22\/what-really-makes-bubble\">What Really Makes A Bubble<\/a><\/span><\/h3>\n<\/div>\n<div id=\"block-zerohedge-content\" class=\"block block-system block-system-main-block\">\n<article class=\"node node--type-article node--view-mode-full\" role=\"article\" data-gtm-vis-recent-on-screen-2077925_22=\"1099\" data-gtm-vis-first-on-screen-2077925_22=\"1099\" data-gtm-vis-total-visible-time-2077925_22=\"100\" data-gtm-vis-has-fired-2077925_22=\"1\">\n<div class=\"node__content\">\n<div class=\"clearfix text-formatted field field--name-body field--type-text-with-summary field--label-hidden field__item\">\n<p><a href=\"http:\/\/datatrekresearch.com\/\"><em>Via DataTrekResearch.com,<\/em><\/a><\/p>\n<p><strong>If I could strike one word from Wall Street\u2019s dictionary, it would be \u201cBubble\u201d.\u00a0<\/strong>It is too often used in place of actual research and now seems to simply denote any asset that rises quickly in value, gets broader attention, and then rises some more. Even worse, since the Financial Crisis the word only seems more popular.<strong> Calling bubbles has reached its own bubble&#8230;<\/strong><\/p>\n<p><a href=\"https:\/\/www.zerohedge.com\/sites\/default\/files\/inline-images\/Bubble.png?itok=iiS_aOn7\" data-image-external-href=\"\" data-image-href=\"\/sites\/default\/files\/inline-images\/Bubble.png?itok=iiS_aOn7\" data-link-option=\"0\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/www.zerohedge.com\/sites\/default\/files\/inline-images\/Bubble.png\" srcset=\"https:\/\/www.zerohedge.com\/sites\/default\/files\/styles\/inline_image_desktop\/public\/inline-images\/Bubble.png?itok=iiS_aOn7 1x\" alt=\"\" width=\"500\" height=\"422\" data-entity-type=\"file\" data-entity-uuid=\"0a6325ab-d3b7-4711-aab5-6ab63f2d5439\" data-responsive-image-style=\"inline_images\" \/><\/a><\/p>\n<p><strong>But since the word\u2019s usage in finance is too entrenched to wipe it away, we should at least differentiate between systemically harmful bubbles and simple curiosities.<\/strong>\u00a0For example:<\/p>\n<ul type=\"disc\">\n<li>Harmful: the NASDAQ bubble in 1999\/2000 caused $2 trillion of value destruction when it burst in late 2000 \u2013 2002. It had a hand in slowing US growth and damaged a whole generation of investors\u2019 confidence in equity markets.<\/li>\n<\/ul>\n<ul type=\"disc\">\n<li>Nearly deadly: the 2007 US housing bubble set up the Financial Crisis and Great Recession, with global effects running to the tens of trillions of dollars.<\/li>\n<\/ul>\n<ul type=\"disc\">\n<li>Curiosity: by contrast, this year\u2019s bursting of the crypto currency bubble was much less meaningful both in terms of size ($620 billion lost from January 7th peak to now) and impact on the broader global economy (essentially zero).<\/li>\n<\/ul>\n<ul type=\"disc\">\n<li>Curiosity: legal marijuana stocks \u2013 the latest group stuck with the \u201cbubble\u201d moniker, are even smaller than crypto currencies. The largest one by market cap \u2013 Canopy Growth \u2013 has a market cap of $15 billion. Tilray\u2019s market cap is $13.5 billion. Aurora Cannabis\u2019 market cap is $9.0 billion, and Cronos Group is $2.4 billion.\n<p><strong>If they all got cut in half tomorrow, it wouldn\u2019t matter to anyone other than current holders.<\/strong><\/li>\n<\/ul>\n<p><a href=\"https:\/\/www.zerohedge.com\/sites\/default\/files\/inline-images\/2018-09-21_12-43-56_0.jpg?itok=hWWvDWMm\" data-image-external-href=\"\" data-image-href=\"\/sites\/default\/files\/inline-images\/2018-09-21_12-43-56_0.jpg?itok=hWWvDWMm\" data-link-option=\"0\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/www.zerohedge.com\/sites\/default\/files\/inline-images\/2018-09-21_12-43-56_0.jpg\" srcset=\"https:\/\/www.zerohedge.com\/sites\/default\/files\/styles\/inline_image_desktop\/public\/inline-images\/2018-09-21_12-43-56_0.jpg?itok=hWWvDWMm 1x\" alt=\"\" width=\"500\" height=\"433\" data-entity-type=\"file\" data-entity-uuid=\"336cc2fb-ca76-4005-95a6-653b3d187c77\" data-responsive-image-style=\"inline_images\" \/><\/a><\/p>\n<p><strong>To our thinking, the more interesting question about bubbles is \u201cWhy do they form in the first place and how can I be early in finding them?\u201d\u00a0<\/strong>As far as we can see, every investment mania of the modern era is the same and has varying degrees of these 5 features:<\/p>\n<p>\u2026click on the above link to read the rest of the article\u2026<\/p>\n<\/div>\n<\/div>\n<\/article>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>What Really Makes A Bubble Via DataTrekResearch.com, If I could strike one word from Wall Street\u2019s dictionary, it would be \u201cBubble\u201d.\u00a0It is too often used in place of actual research and now seems to simply denote any asset that rises quickly in value, gets broader attention, and then rises some more. Even worse, since the [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[1806,21832,860,4318],"class_list":["post-38154","post","type-post","status-publish","format-standard","hentry","category-economics","tag-bubble","tag-data-trek-research","tag-wall-street","tag-zerohedge"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/38154","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=38154"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/38154\/revisions"}],"predecessor-version":[{"id":38155,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/38154\/revisions\/38155"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=38154"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=38154"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=38154"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}