One of the first YC Startup Schools (the first?) was held in April 2008. I was there and distinctly remember one of the presenters, an editor from one of the fi

One of the first YC Startup Schools (the first?) was held in April 2008. I was there and distinctly remember one of the presenters, an editor from one of the financial monthlies IIRC. He claimed that subprime defaults (no mention of housing bubble among the mass media at that point) were no big deal and wouldn't be much trouble to the economy. The real metric to watch was the direction of worker productivity. Having witnessed the collective madness of the bubble that inflated relentlessly for well over ten years (zero-down mortgages almost by default, flip-o-mania, price appreciations far in excess of inflation, non-stop chatter about real estate the double-digit gains made in the last year), I was stunned. This guy didn't have a clue about what was right in front of his nose. He wasn't alone. A similar effect operates in the early phases of a bull market. Take the years following 2001. Interest faded fast in building riches through day trading nasdaq shares. Silicon Valley looked more ridiculous by the day. Sock puppet commercials and online grocery delivery services became the butt of jokes. An entire business model (making money online) lay in ruins. As the nasdaq clawed its way back, very few noticed. Two points: 1. You'll know it's a bubble when only cranks are calling bubble. 2. You'll know its a new bull market when each advance is greeted with yawns, laughs, or eye-rolls.