Titled 'The Main Stages of a Bubble', it is a representation of the stages that all bubbles (real estate or otherwise) travel through.
How else to describe the belief by some economist's that the 'threat' of a bubble forming in Metro Vancouver has dissipated?
A Conference Board of Canada report released today quotes senior economist Robin Wiebe as saying not only has “the threat of a bubble largely dissipated” in Metro Vancouver “but, really, there never was one.”
See? There never was a bubble. Our market has achieved a New Paradigm.
For those who study Bubbles, it has always been difficult to truly appreciate how pervasive and engulfing the Mania Phase can be.
People still look back at Holland's tulip mania in the 1600's with a sense of bewilderment. Long considered the first recorded speculative bubble, the peak of tulip mania saw single tulip bulbs selling for more than 10 times the annual income of a skilled craftsman.
Peering back across the gossamer waves of time, it's often difficult to comprehend how the enthusiasm for tulip bulbs could beget the all-consuming greed that leads to the delusional prices which then entrap a nation into believing that somehow a new paradigm could be created in the price of tulips.
By the time our current situation bursts, residents of the Village on the Edge of the Rainforest will be experts on just how a inexplicable Mania can completely grip a populace.
People will say "it's just real estate" the same way we now look at them as "just tulip bulbs."
Click 'comments' below to contribute to this post.