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A take I saw recently is: if people are still asking "are we in a bubble" then we are not yet in a bubble.
by dpe82 10mo ago
A take I saw recently is: if people are still asking "are we in a bubble" then we are not yet in a bubble.
- Retr0id 10mo agoI think it'd be truer to say that you can't be sure it's a bubble until after it pops.
- rvz 10mo agoThat is like telling others who experience natural disasters to wait until it happens and then ask themselves "How much damage will it bring" and then someone else tells them that it costed them everything. Anyone who has lived through the dotcom bubble knows that this AI mania is a obvious bubble and the whole point is you have to prepare before it eventually pops, not after someone tells you that it is too late when it pops.
- Retr0id 10mo agoYou don't prepare by making predictions about when it will pop, you prepare by hedging etc. Just as those who live in earthquake-prone areas build earthquake-resistant buildings.
- rvz 10mo ago> you prepare by hedging etc. Has to be done before the eventual collapse of the bubble and still proves my whole point: >> the whole point is you have to prepare before it eventually pops.
- Retr0id 10mo agoKnowing whether it is or isn't a bubble isn't relevant to the decision to prepare. You prepare for both possibilities!
- deleted 10mo ago[deleted]
- deleted 10mo ago[deleted]
- 9rx 10mo agoExcept not all (market) bubbles pop. Sometimes they slowly deflate, and sometimes they stabilize ("soft landing").
- 9rx 10mo agoBubbles occur when undue attention is directed towards something. When people are asking "are we in a bubble", there is no question that we are in a bubble. Nobody pays attention to things aligned to the fundamentals. That doesn't mean there will be a crash, though. Not all bubbles pop.
- mxschumacher 10mo agowhat are some historical examples of bubbles that didn't pop?
- 9rx 10mo agoSince this is HN, I'll go with the most obvious: Software development. Unsustainable, speculative growth through the COVID-19 period, but on the other side relatively slow decline.
- simianwords 10mo agoThis is the perfect example of people who constantly cried that it is a bubble but it wasn’t.
- 9rx 10mo agoNobody pays attention to things aligned to the fundamentals. When people are crying that there is a bubble, it is a bubble. Plain and simple. We know for certain it was a bubble as non-bubbles have sustainable growth. As all the software developers now struggling to find work will be happy to tell you, the growth wasn't sustainable. The proof is in the pudding.
- simianwords 10mo agoHow do you prove that software development is a bubble? Stock prices are at all time high and continuously growing.