Bubbles

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This chapter of the new Crash Course series has not yet been made available to the public.

Each week over the rest of 2014, in sequential order, a new chapter will be made publicly available (we've currently published up to Chapter 15)

If you don't want to wait, you can:

video

This chapter of the new Crash Course series has not yet been made available to the public.

Each week over the rest of 2014, in sequential order, a new chapter will be made publicly available (we've currently published up to Chapter 8)

If you don't want to wait, you can:

video

This chapter of the new Crash Course series has not yet been made available to the public.

Each week over the rest of 2014, in sequential order, a new chapter will be made publicly available (we've currently published up to Chapter 21)

If you don't want to wait, you can:

video

In the Crash Course we will learn a few foundational Key Concepts. None is more important than exponential growth. Understanding this will greatly enhance our chances to form a better future.

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Ahora, una vez estudiados los activos de Usamérica, dedicaremos este capítulo a comprender las denominadas burbujas, para saber qué son, cómo se forman y cuáles son sus consecuencias. De manera específica examinaremos con todo detalle la burbuja inmobiliaria, porque está sucediendo en estos momentos y es la mayor de toda la historia, además de, probablemente, la más destructora.

A lo largo de la historia, el estallido de las burbujas financieras ha sido casi siempre traumático. Las agitaciones sociales, políticas y económicas tienen la mala costumbre de suceder a las burbujas financieras, toda vez que la destrucción de la riqueza es uno de sus rasgos característicos.

En todo comportamiento económico irracional puede que resulte difícil distinguir entre una burbuja, una obsesión y un mero toque de exuberancia. El término burbuja se reserva para el colmo de la locura, y ya se sabe que la historia es rica en locuras.

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Okay, jetzt, nachdem wir einen Blick auf die US-Vermögenswerte geworfen haben, müssen wir einige Zeit darauf verwenden, zu verstehen, was eine Blase in Bezug auf Vermögenswerte darstellt.

Eine solche Blase nennt man „Vermögensblase“. Wir betrachten, wie sie sich bildet und welche Konsequenzen deren Platzen hat. Im Speziellen werden wir uns mit der derzeit bestehenden Immobilien-Blase befassen, welche die größte Blase der Geschichte ist und wahrscheinlich auch die Zerstörerischste.

In der Vergangenheit war das Platzen von Vermögensblasen fast immer traumatisch. Soziale, politische und ökonomische Umbrüche haben die schlechte Angewohnheit, Vermögensblasen zu folgen. Ein garantiertes Merkmal von Vermögensblasen ist die Zerstörung von Vermögenswerten. 

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You are at the part of the Crash Course where everything you learned comes together into a single chapter. Chapter 19 contains a comprehensive view of how all of our problems are actually interrelated and need to be viewed as such or solutions will continue to elude us.

We will review the key trends, which appear to be converging on a very narrow window of the future. Here is a two-second recap of the key issues. If you have watched all of the videos until this point, you will undoubtedly see how they are connected:

Money, credit, growth. Exponential growth. Debt, future, history. Failure to save. Assets, housing, bubble, financial panic. Demographics, wealth, boomers, falling values. Fuzzy numbers. Energy, oil, growth. Peak Oil. Environment, resources, exploitation, change.

This chapter will connect the dots and beckon us toward the future.

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Along the continuum of irrational financial behavior, it can be tricky to tell the difference between a bubble, a mania, and mere touch of exuberance. A bubble is reserved for the height of folly, and history is rich with folly.

So how would we know that we’re in an ‘asset bubble’? What do they look like and what can we expect when one bursts? The Fed famously likes to claim that you can’t spot one until it bursts. But actually you can, and the definition is pretty simple.

Bubbles used to happen once every generation or so, because it took time to forget the pain from the damage. Today we are facing the bursting of a second major asset bubble, housing, spaced less than ten years from the bursting of the dot-com bubble. This is simply astounding and thoroughly unprecedented. It is the largest bubble in all of history and will probably be the most destructive. And it is happening right now.

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Massive change is upon us. To understand the nature of this change, we need to understand the three “E”s – the Economy, Energy, and the Environment - which is where we’ll spend the rest of our time in the Crash Course.

The first “E” is the economy, which is the lens through which the Crash Course looks at everything, specifically exponential money, the first-ever collapse of a global credit binge, an aging population, and a national failure to save.

The second “E” is energy. We will explore what Peak Oil implies for an economic system that is based on continual expansion.

The third “E”, the environment, will be exerting its own unknowable but certainly significant economic burdens due to shrinking resources and other systemic pressures while the other two “E”s are clamoring for your money and attention.