Sentences with phrase «many asset bubbles»

Even more devastating, wages» share of GDP has been declining (with brief interruptions during asset bubbles) for 46 years.

One person who pointed out the dangerous asset bubble developing in 2005 was economist Robert Shiller, whose composite Case - Shiller index, created in the 1990s, studies real estate prices nationally and in key urban areas.

«If you think about the creation of asset bubbles, that's always what happens,» Ariely says.

The chart below from Shane Oliver, chief economist and chief investment officer at AMP Capital, puts Bitcoin in historic perspective with other major asset bubbles.

Confirmation bias is the primary reason why otherwise intelligent people get caught up in asset bubbles that are obvious in the unforgiving light that comes the morning after.

Relatively easy liquidity has fuelled investment in China's notoriously frothy real estate sector - property investment jumped 22.8 percent in January and February combined from 2012 - pushing up home prices and triggering hawkish talk on property tightening from Beijing policymakers to contain the risk of an asset bubble rapidly inflating.

«The government's policy challenge for this year is to strike a balance between containing an asset bubble and pushing the economy out of the growth malaise,» she said.

Economists like Christopher Thornberg of Beacon Economics say asset bubbles become dangerous when they lead to other imbalances in the economy.

Republican critics say they fear that by flooding the financial system with money, the Fed has inflated stock and real estate prices and could create asset bubbles that could pop with dangerous consequences for the economy.

Many Chinese commentators think the Plaza Accord of 1985, reached in New York by finance ministers from five developed countries, did not solve many problems in the world and was partly to blame for the Japanese asset bubble and subsequent slowdown.

Critics argue that such monetary easing creates the potential for asset bubbles and distortions in bond markets.

Treasury yields have been rising not because of rising risks but because the asset bubble in bonds is deflating, inflation is rising, and investors are demanding more yield.

What all that money sloshing around the system would do, more likely, is encourage the formation of another asset bubble.

Some argue that monetary policy should «lean against» incipient asset bubbles.

The Congressional Budget Office defines asset bubbles as: «An economic development in which the price of a class of physical or financial assets (such as houses or securities) rises to a level that appears to be unsustainable and well above the assets» value as determined by economic fundamentals.

Thanks to Mackay's vivid account, tulips are a well - known cautionary tale, applied to asset bubbles of all types; here's the problem, though: there's a decent chance Mackay's account is completely wrong.

China has been trying to get its unruly financial sector under control, worried that asset bubbles and its enormous unofficial — or «shadow» — banking system could threaten its economy, the world's second largest after the United States».

3One might argue that an innovation is not a necessary condition for an asset bubble.

How Should We Respond to Asset Bubbles?

By late August, the DJIA had gained 44 percent in a matter of seven months, stoking concerns of an asset bubble.4 In mid-October, a storm cloud of news reports undermined investor confidence and led to additional volatility in markets.

Asset bubbles often come to an end when the basic belief system is contradicted by events.

Soros has a comment that applies here as well: «when interest rates are low we have conditions for asset bubbles to develop.

If this is true, by the way, it means that attempts at implementing liberalizing reforms are successful mainly during periods of great global liquidity, and this might have implications for China, especially if over the next few years global central banks begin to withdraw the huge liquidity injections that have underpinned asset bubbles around the world.

Terms like «asset bubble» and «easy money» aren't in their normal vocabulary.

We know the bankers on the Federal Advisory Council saw an «asset bubble» as of September 7.

There wouldn't be a an asset bubble either if growth and wages fueled inflation and that led to an interest rate rise.

Behind Germany and ahead of some of the oil producers, it runs the largest current account surplus in the world, which means that it is exporting its excess savings in a world that has nowhere to put the money, and so the world must respond either with speculative asset bubbles, unproductive investment, debt - fueled consumption binges or unemployment.

Moreover, bitcoin ticks all of the boxes that we consider to be essential criteria of any asset bubble:

Mostly he says unless the U.S. is a developing country without domestic access to capital (obviously not), out trade deficit causes unemployment and asset bubbles.

It has, in turn, created asset bubbles that could explode into an even greater crisis the next time around.

When one compares bitcoin's five - year price momentum (adjusted for inflation) against that of previous asset bubbles, bitcoin dwarfs the runners - up — the Mississippi bubble of 1720 and the Amsterdam Tulip Mania of 1637.

Compared with Other Bubbles, Bitcoin Is almost off the Charts Five - year price momentum of bitcoin vs. historic asset bubbles; priced monthly; logarithmic scale

Still, Fed Chairman Ben Bernanke is attempting to inflate asset bubbles.

For example, a reduction in capital inflows can deflate asset bubbles and so discourage consumption through wealth effects, or such a reduction can lower consumption by raising interest rates on consumer credit, or even by encouraging stronger consumer lending standards.

The first set of costs stems from the risk that the current monetary policy regime could distort asset allocations and lead to renewed financial asset bubbles.

In addition, the world's largest cryptocurrency «ticks all of the boxes» of the essential criteria for any asset bubble, including overtrading, «new - era» thinking and rising leverage, he wrote.

David Jones, an author of several books on the Fed, is among analysts who say the Fed may actually be pleased that the stock market has retreated after a prolonged period of record highs that had raised fears of a dangerous asset bubble that could burst and derail the economy.

We are only partway through the Bernanke Asset Bubble.

... this «Bernanke Asset Bubble» may be due for a short pause.

About the author: JS Kim is the Managing Director and Founder of SmartKnowledgeU, a fiercely independent research, consulting and education firm that focuses on gold and silver asset investment strategies as a means of countering the damaging effects of rapidly devaluing fiat currencies worldwide and price - distorted stock market and asset bubbles created by Central Bankers.

What is inter alia noteworthy here, is that all it took for the last two asset bubbles to burst (pre-bitcoin era) was a slowdown in the growth of money and credit (the two are intertwined most of the time).

A civil war, two world wars and other conflicts, political upheavals, corporate scandals, energy crises, and a plethora of asset bubbles; despite all of this and more, American industry has prospered and the US equity market has delivered attractive long - term returns.

The monetary stimulus, known as quantitative easing, means that the Fed is monetizing US government debt, which critics contend could lead to future inflation and asset bubbles.

Investors are no longer overly optimistic... This is a small correction in the great Bernanke Asset Bubble.

Even if economists and the Fed chairperson struggle to identify them, there are plausible reasons to explain why asset bubbles last so long.

According to Asgeir Jonsson, an economist at Reykjavik - based asset manager Gamma, «If the development continues without interference, this will lead to a property bubble within the next two years» and «There's a greater risk of an asset bubble being created in an economy that is closed off behind capital controls.»

All to suspend the deflationary effects that followed the bursting of a cheap credit induced asset bubble that popped nearly 30 years ago.

[5] Robert Shiller, the economist who successfully predicted the popping of the Dot - com and U.S. housing bubbles, warned investors against treating Sweden and Norway's markets as safe - havens as the Nordic region is caught up in asset bubbles that will end with plunging asset prices.

Others wonder why economists and policymakers can not prevent, or even spot, most asset bubbles before they become dangerous.

The premise of Shiller's work on asset bubbles has been long accepted by economists; demand for an asset becomes detached from fundamental factors and appears to be built on rapid increases in market value.