Bubbles are easy to spot. Wait, don’t most people say that bubbles are impossible to spot?
I’ll say that again: bubbles are easy to spot. Why? People have the wrong theory on bubbles. They listen to those that don’t understand the efficient markets hypothesis, and think, “Prices are always fair predictors of the future. I don’t have to think about the future as a result.” (It would be better to say that current prices are the short-term neutral line against which bets are placed.)
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