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Market bubbles: How and why and what to do when they form

Posted on May 16, 2008

Below is a very good article about how and why bubbles form, written by Justin Lahart for The Wall Street Journal. The article, entitled Bernanke's Bubble Laboratory, cites Ben Bernanke s prot g s at Princeton to explain and study the economics of manias. Princeton, 40 miles south of Wall Street, is home to a band of young scholars hired by former professor Ben Bernanke, now the nation's chief bubble watcher as Federal Reserve chairman. The group includes Mr. Hong, a Vietnam native raised in Silicon Valley; a Chinese wunderkind who started as a physicist; and a German who'd been gro...

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