Given all the news on Dubai and the debt situation, I wanted to take a look at three "bubbles" I had first hand experience seeing and was somehow tied:
1) 2000 tech bubble-I was at Stanford at the time, and in my fraternity alone there was some absurd number of start-ups (I think it was 15). Everyone on campus was trying to start a company. People were dropping out of school to start these companies. I remember steamtunnels, woosh, college411, afindz and the list goes on and on. Even at that time, everyone was talking about a bubble, before the market crashed.
2) When I was living in Los Angeles in 2004, real estate was out of control. People with no education were buying apartments and flipping them. I was in the market for an apartment at the time and everyone i knew kept telling me not to buy because of the "bubble." It was not until 2006 when real estate prices stopped growing and starting falling.
3) In December 2007, I visited Dubai and we were told that 20% of the world's cranes were there. They seemed to have an endless appetite to build unnecessary buildings in order to create a tourist attraction. From the two palms, to the Bourj, to the world, everything seemed over the top. Everyone on my trip kept talking about the "bubble." Dubai was justifying all the building by saying they would attract the toursits.
The lesson learned here is that if you are generally hearing there is a bubble, there is a bubble. Bubbles are created by overspeculation. When people are speculating about overspeculation, then it has happened. Get it?
Let me give you a clue what is next: its starts with "clean" and ends with "energy"....
