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That doesn't explain why they all have to line up in time. If each individual boom or bust was spread over time, it would disappear in the noise.
by imtringued 2y ago
That doesn't explain why they all have to line up in time. If each individual boom or bust was spread over time, it would disappear in the noise.
- andruby 2y agoThey don't always all line up in time. Companies grow and die all the time. Trends, Hypes and Bubbles are probably a consequence of human nature: most investors have a deep fear-of-missing out, so in general money loves to jump on the hype-train. Likewise, fear and uncertainty easily spread: markets moving together. When a couple of businesses fail, that insolvency or illiquidity spreads to related businesses.
- bobthepanda 2y agoBooms and busts have cyclic effects. Booms provide more capital and credit that can be reinvested and beget more booms; busts collapse demand and can contagiously bust other sectors.