Tulip Mania (1637): This is often considered the first recorded speculative bubble. In the Netherlands, tulips became a luxury item, and their prices skyrocketed as more people invested in them. At its peak, some tulip bulbs were valued as much as a house. When the bubble burst, prices collapsed, and many people were left in financial ruin.
Dotcom Bubble (2000): During the late 1990s, internet companies were seen as the next big thing. Investors, eager to cash in on the tech boom, poured money into startups with no profits or even revenue. Stock prices surged, but when it became clear that many of these companies had no viable business models, the bubble burst in 2000, wiping out trillions of dollars in market value.
Housing Bubble (2008): Leading up to the 2008 financial crisis, housing prices rose rapidly, and many believed they would continue to rise indefinitely. Lenders issued risky mortgages, and investors bought mortgage-backed securities, believing housing was a safe bet. When home prices fell, many borrowers defaulted on their loans, leading to a global financial crisis.
Cryptocurrency Booms (2017 and 2021): Cryptocurrencies like Bitcoin have gone through multiple boom-and-bust cycles. In 2017, Bitcoin reached nearly $20,000, fueled by speculation and herding. Many investors joined the rush, only for the price to collapse. Similarly, in 2021, Bitcoin surged past $60,000 before experiencing a sharp decline, causing major losses for many who followed the hype.