How to Spot a Bubble

How to Spot a Bubble

Fergus Hodgson, February 19, 2018

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As much as many of us want to believe in the efficient-market hypothesis—that all information is embedded in the price—turmoil and the business cycle continue to challenge the notion of completely rational markets. The question then is, how does one know when there is a market bubble and, perhaps more important, when it will pop?

Daniel Lacalle of Spain, now based in the United Kingdom, is a prolific author and commentator on economics and finance. Also a certified international investment analyst, he joins us to explain the key traits of a bubble and the distinction between a correction and the final end of an expansion.

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