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As shown in Exhibit 1, when a market bubble bursts, demand falls, and prices decline quickly. Investors who established positions near the top could see
As shown in Exhibit 1, when a market bubble bursts, demand falls, and prices decline quickly. Investors who established positions near the top could see their profits erode completely. Depending on its size, a deflating bubble can have short-term effects to an industry or market niche, but it could also prompt large scale consequences [1], such as the recent Global Financial Crisis, triggered by the deflation of the US housing market during 2007-2008
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