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Remember the market can remain irrational longer than you can remain solvent. It is seldom a good idea to short an asset just because you think it is a bubble,
by sidko 9y ago
Remember the market can remain irrational longer than you can remain solvent. It is seldom a good idea to short an asset just because you think it is a bubble, unless you're able to call the peak.
- Bartweiss 9y agoTrue, but even so. Most bubbles see at least a few players stake long bets against them (e.g. housing), usually whoever is rich enough to eat months or years of margin calls. Letting pessimists enter the market rationalizes things that much faster. For something like BTC, the market is actively pressured to stay irrational because any non-holder who expects prices to drop can't enter - you only play if you're bullish.