what is a bubble 
a bubble is an economic cycle that is characterized by the rapid escalation of market value particularly in the price of assets this fast inflation is followed by a quick decrease in value or a contraction that is sometimes referred to as a crash or a bubble burst typically a bubble is created by a surge in asset prices that is driven by exuberant market behavior during a bubble assets typically trade at a price or within a price range that greatly exceeds the asset s intrinsic value the price does not align with the fundamentals of the asset the cause of bubbles is disputed by economists some economists even disagree that bubbles occur at all on the basis that asset prices frequently deviate from their intrinsic value however bubbles are usually only identified and studied in retrospect after a massive drop in prices occurs 