Term of the Day: Bubble Theory

	View online | Add Investopedia to safe senders list
	INVESTOPEDIA Term Of The Day September 3, 2015 Bubble Theory A school of thought that believes that the prices of assets can temporarily rise far above their true values and that these bubbles are easily identifiable. Former Federal Reserve Chairman Alan Greenspan famously coined the term "irrational exuberance" referring to asset bubbles. Under the bubble theory, large overvaluations of assets can persist for many years, but eventually burst, causing precipitous declines before returning to more reasonable prices. Breaking It Down: One of the most famous historical examples of an asset bubble is the so-called "tulipmania" in the... Read More Related to "Bubble Theory" Why Housing Market Bubbles Pop Unlike the stock market, where most people understand and accept the risk that stock prices might fall... Read More The Financial Markets: When Fear And Greed Take Over There is an old saying on Wall Street that the market is driven by just two emotions: fear and greed. Although this is an oversimplification... Read More Riding The Market Bubble: Don't Try This At Home In almost all instances, the root cause of a financial crisis is an asset bubble. But how does this bubble form... Read More Recently Added Definitions Dividend Yield A financial ratio that indicates how much a company pays out in dividends each year relative to... Read More Discount Bond A bond that is issued for less than its par (or face) value, or a bond currently trading for less than its... Read More Related Definitions Bubble Speculative Bubble Echo Bubble Housing Bubble Tech Bubble Past Terms of the Day Stock Market Crash Financial Crisis Shanghai Stock Exchange Dead Cat Bounce Bear Market You are currently subscribed as: mondemand.forex@blogger.com Unsubscribe | Unsubscribe From All | Manage Profile Investopedia US, A Division of IAC. Copyright © 2015, Investopedia, LLC. All Rights Reserved Follow Us: