Market corrections are inevitable after bubbles burst from "summary" of Irrational Exuberance by Robert J. Shiller
The bursting of bubbles in financial markets is a phenomenon that has been observed throughout history. When asset prices become detached from their intrinsic value, driven by irrational exuberance and speculative behavior, a correction is inevitable. This correction is a natural consequence of the market's tendency to self-correct, bringing prices back in line with fundamentals. Market corrections serve as a reality check for investors, reminding them of the risks inherent in chasing unsustainable gains. They also help to prevent the formation of new bubbles by restoring a sense of rationality and discipline to the market. While corrections can be painful for those who have bought into the bubble at its peak, they are ultimately necessary for the long-term health and stability of the market. In...
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