Financial asset price bubbles are not unique to any time or place. For at least the last four hundred years, they have been experienced in many different nations and cultures. And had extensive money and credit creation and recording systems existed in earlier times, we can surmise that bubbles would have occurred then too. Price bubble effects and artifacts have been seen in everything from stocks and bonds to tulip bulbs, real estate, gold, and all other types of commodities and asset classes. Yet there have often been relatively long periods without any important bubbles or crashes, and other periods in which such episodes, in effect volatility clusters (on a large fractal scale), have appeared rather frequently.

Even so, however, for all the work on trying to understand such phenomena by parsing price changes into fundamental-value and bubble components, there has been limited progress to date. As Voth (2003) says, “distinguishing bubbles from increases in asset prices driven by fundamentals (or sensible beliefs about the future development of fundamentals) is no easy matter.”

That is not for lack of trying, though. All sorts of bubble studies and approaches have been undertaken and all sorts of nomenclature invented. Rational bubbles and expectations, intrinsic bubbles, churning bubbles, collapsing bubbles, regime switches, and many other variants have all become parts of this jargon.