Market irrationality became evident from "summary" of The Great Crash 1929 by John Kenneth Galbraith
One of the most striking features of the stock market in the months leading up to the crash of 1929 was the clear and undeniable presence of irrationality. Investors seemed to be gripped by a collective hysteria, driving prices to ever higher levels based on nothing more than speculation and unfounded optimism. This irrationality was evident in many ways, but perhaps most notably in the disconnect between stock prices and the underlying value of the companies they represented. As prices soared to dizzying heights, it became increasingly clear that they bore little resemblance to the actual earnings and assets of the companies in question. Furthermore, the behavior of investors themselves was often irrational and erratic. Instead of basing their decisions on car...
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