Finance & Fury Podcast

Are sectors of the US share market in financial bubble territory?

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Sinopsis

Welcome to Finance and Fury. Are sectors of the share market in a bubble, one in particular that comes to mind would be the US tech sector. There have been many bubbles in financial markets throughout history – if enough excitement is generated around some new asset, or commodity that is seen as the next big thing and everyone starts buying – bubbles can emerge in prices covered some of them, south sea bubble, tulip mania – one that may be the most similar is the dotcom bubble – But how exactly is a bubble designed? And what metrics can be used to measure this The traditional definition of an economic bubble – “An economic bubble or asset bubble is a situation in which asset prices appear to be based on implausible or inconsistent views about the future. It could also be described as trade in an asset at a price or price range that strongly exceeds the asset's intrinsic value.” However – the intrinsic value – or fair value of an asset can be fairly subjective – especially for new or emerging companies or ass