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Learning from Financial Manias and Market Spikes
Historical financial manias in the American culture have often led to market spikes followed by train wrecks. Despite the failures, valuable innovations have consistently emerged from such periods. However, it's crucial to be prepared for disruption, as the aftermath could bring different winners, use cases, and outcomes. The dot com bubble serves as a stark reminder that investors may recognize a bubble yet still feel compelled to join in for fear of missing out, prolonging the cycle. Being on a market spike necessitates caution, as the subsequent downturn may not benefit current market players.