When an "asset class" has a period of significant value increase driven not by rational supply/demand but by some UnSustainable lever. Which leads to a significant value drop when things change. (cf Crisis)
Within economics, Reflexivity refers to the self-reinforcing effect of market sentiment, whereby rising prices attract buyers whose actions drive prices higher still until the process becomes unsustainable. This is an instance of a positive feedback loop. The same process can operate in reverse leading to a catastrophic collapse in prices. https://en.wikipedia.org/wiki/Reflexivity_(social_theory)
- cf George Soros
Extraordinary Popular Delusion-s and the MadnessOfCrowds is a history of popular folly by Scottish journalist Charles Mackay, first published in 1841. The book chronicles its subjects in three parts: "National Delusions", "Peculiar Follies", and "Philosophical Delusions". Despite its journalistic and rather sensational style, the book has gathered a body of academic support as a work of considerable importance in the history of social psychology and psychopathology.
Some say bubbles generate net public gain