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Acid In The Punch Bowl

Why Does The Bull Trap Exist?

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Why does the bull trap exist?

I can clearly see that it does exist but I can't work out the psychology behind it. I would have thought once sentiment turns and prices start to fall then it would become self reinforcing.

I know that in this case base rates and other intervention helped caused it but it is clearly a common element of a bust as illustrated in our favourite graph.

bubble-lifecycle.gif

Cheers

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  • 140 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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