Abstract
Rational speculative bubble size happens when the prices of an asset surpass its intrinsic value. This bubbles are harmful when burst because its gives a big impact towards the economic. The aims of this study is to show the size of rational speculative bubble existed from year 1976 until 2016. The period are separated into four which are the first cycle is from 1/11976 to 6/12/1987, the second cycle happen in 7/12/1987 to 12/8/1998, 13/8/1998 to 26/10/2008 for the third cycle and 27/10/2008 to 31/12/2016 for the fourth cycle. This study is also emphasizing on the trend of the rational speculative bubble from one cycle to another cycle. This bubbles size was studied in three markets which are Hang Seng, S&P 500 and Nikkei 225 by using generalized Johansen-Ledoit-Sornette model. The difference
Highlights
Some investors said that the housing market in United States will not collapse because this market is considered as no harm and this market is the most profitable investment[6]
The aims of this study is to show the size of rational speculative bubble existed from year 1976 until 2016
This study is emphasizing on the trend of the rational speculative bubble from one cycle to another cycle
Summary
Some investors said that the housing market in United States will not collapse because this market is considered as no harm and this market is the most profitable investment[6]. The bubbles burst caused many developed countries like the United States to suffer huge losses. Rational speculative bubble is a condition where the prices of an asset surpass its intrinsic value. The burst of this bubble can cause a collapse of the economic system. This bubble exists when the asset started to be traded. The tulip market was collapsed in February 16371 This same goes to Missisippi bubble[2] and South Sea bubble[3]. As well as bubbles, when the price of an asset is continuously increased regardless of the buyer’s ability to purchase the asset in an uncertain economic environment may lead to an economic downturn. The breakdown of the bubble will have a severe effects towards the country’s economic growth
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callMore From: International Journal of Engineering & Technology
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
