An asset or financial bubble is a situation where asset prices has significantly increased above and beyond its true value. The term “bubble” might have come from one of the earliest examples of financial bubbles. A bubble is compared to the price of a stock that was inflated and expanded based on nothing but air, making it easily susceptible to bursting. In the 1700s, stock prices of the South Sea Co. shot up despite lacking profits.

When the bubble burst, people lost their money, including the famed scientist Isaac Newton, who was claimed to have said: ‘’I can calculate the motions of the heavenly bodies, but not the madness of people.’’

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