Bitcoin Buyers, Beware: Consider These 5 Classic Asset Bubbles

Bubbles - Japanese stock Market
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Until recently, many people had never heard of Bitcoin. But the hyperbolic rise in the price of the digital crypto-currency -- from $5 as recently as mid-2012 to more than $100 recently -- has captured broader attention as financial crises (most recently the one on Cyprus) continue to make markets and investors nervous about traditional, government-issued currencies.

Proponents argue that the rise in Bitcoin's value and use marks a lack of confidence in those fiat currencies whose value is under the influence of central bankers and politicians. Skeptics point back at a long line of economic bubbles as they predict an eventual plunge in Bitcoin prices.

Economic history is on the side of the skeptics. Let's take a look at five other assets that gained even more intense interest among speculators and ordinary investors before their bubbles burst, sending prices back down to earth.





Motley Fool contributor Dan Caplinger has no position in any stocks mentioned. The Motley Fool recommends Amazon.com. The Motley Fool owns shares of Amazon.com. Try any of our newsletter services free for 30 days.

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justoldog

Of course the bit coin will crash- it's not worth the paper it's printed on--

April 04 2013 at 8:16 PM Report abuse rate up rate down Reply
1 reply to justoldog's comment
comanche71

Uhh, just like the dollar??

April 04 2013 at 10:59 PM Report abuse rate up rate down Reply