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A bubble's when values inflate well beyond intrinsic valuations. You can have a crash without this having happened.
by mlyle 1y ago
A bubble's when values inflate well beyond intrinsic valuations.
You can have a crash without this having happened.
- johnnyanmac 1y agoYes, indeed. Thought I'd change "intrinsic valuations" to "rapid change in valuations". If you deflate over time slowly (or simply slow growth expectations) you can prevent a pop. That doesn't tend to be what historically happens, though.
- mlyle 1y ago> to "rapid change in valuations". Yes. This seems to be what you're doing-- carrying the metaphor too far. I believe the common use relates the asset prices to intrinsic or fundamental values.