How to spot a Financial Bubble. Is Bitcoin or Tesla going through a bubble? скачать в хорошем качестве

How to spot a Financial Bubble. Is Bitcoin or Tesla going through a bubble?

Do you think that cryptocurrencies like Bitcoin or shares like Tesla are undergoing a classic financial bubble? In this video I explain what financial bubbles are and how to identify them. Nearly all bubbles follow the same pattern before they go pop, but a common theme is that many people lose a fortune if they are sucked up in the hype of the bubble. The 5 stages of a financial bubble are: 1. An innovative way of doing something upset the status quo. Pepple buy in and the price rises gradually 2. Rapid growth fed by the psychology of Fear of Missing Out (FOMO) 3. Ever higher prices are sustained by the belief that new fundamentals are now in place. If you hear the words 'new paradigm' then that is a sure sign that we're in stage 3. 4. Some people take profits and volatility increases. The average price starts to plateau off as new entrants are now thin on the ground that are willing to buy in at inflated prices. 5. Something, usually quite minor, pricks the bubble and panic selling takes over. Price crashes rapidly Time scales are usually quite short. In the case of the Tulip bulb bubble in the 1600's it took just 3 months to go to the peak and then another 3 months to crash back down again.