Definitions
This occurs when asset prices rise extremely fast in a short time due to expectations of continued growth.
An economic bubble
Bubbles form when this is very high
Demand
This is a person or thing that takes the place of another
Placeholder
This 1630s event involved tulip prices increasing dramatically before crashing
Tulipmania
The levels prices rise to that cannot be maintained long term
Unsustainable levels
Bubbles always do these two things
Form and Pop
Something that is easily broken or damaged
Delicate
In this country, real estate and stock prices tripled in the late 1980s
Japan
This happens after a bubble bursts and involves a widespread decline in economic activity
Recession
Bubbles begin with this phase
expansion
The act of buying, holding, or selling financial assets with high level of risk, short term gains
Speculation
In Japan, this location was worth more than all real estate in California
Imperial Palace grounds
Bubbles happen due to people expecting prices to keep doing this
increasing
Bubbles end with this phase
contraction
This vocab word best describes how a bubble behaves
delicate
This period followed Japan’s bubble burst and involved years of deflation
The Lost Decade
This is the comprehensive definition of bubbles
an emergent property of markets, tending to have no single clear cause or to be underpinned by deliberate fraud
This is what causes prices to drop significantly after a bubble bursts
collapse
Investors holding an asset temporarily until they can pass it on to someone else
Placeholder
Tulip prices increased by roughly this amount before crashing
Twentyfold (20x)