how does an economic bubble\speculative bubble work?
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I have some apples. I’m selling them for $1 each. Some guy comes along and he thinks they are worth more, so he gives me $2 each. Then some other guy comes along and thinks the apples are worth even more, and pays him $3 each. Then more people get hyped about these apples because the prices are soaring, and now there are 6 new guys each trying to offer more than the other for the apples. Eventually, this drives the price of the apple up to $100 each. It’s still the same $1 apple.
The bubble was inflated by a combination of hype and demand, and all it takes is enough people to remember these $100 apples are really just $1 apple for it the bubble to pop.
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