How to Spot an Economic Bubble

It was about 2003 that I first saw the housing bubble. I have no backing for this. I didn’t say to strangers, you know, in 2009 our markets will be in the worst shape since the Great Depression because housing prices are way-higher than they should be. But I swear to it that that’s when I saw it. And I’ll tell you why. It’s pretty simple. I saw on the news that housing had reached an all time high and I thought to myself, “No one’s gonna pay that much for that house.” And yet, people did.

So, if you want to know how to spot a bubble, just ask yourself if the product in question could conceivably be worth the market value.