In a rising price environment, people tend to throw analysis of risks out of the window. In their mind, the only possible risk is not to join the party.

When people hear others’ stories about becoming overnight millionaires, they act upon it and invest their life savings, their houses, and their retirement funds.

When an economy or market is flushed with excess liquidity, people start to invest in unrealistic possibilities.

In a bubble, people demonstrate some sort of cult-like behavior. They defend their positions, not by economic logic, but by force. They do this by calling those whodisagree with them dirty, and mocking people who give them prudent advice.

Excess liquidity is the leading source of all bubbles.

Bubbles feel like a party.

Markets are not efficient enough; that’s why we have market peaks and bottoms now and then.

In a bubble, people are ready to pay any price without any regard to intrinsic value or any value whatsoever because they believe they can always sell it for a profit.