What is a commodity bubble?

in #commodity2 years ago

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A commodity bubble is an economic phenomenon that occurs when the demand for a good or service outstrips its production capacity.
When the growth of digital technology becomes so rapid that it can be called a "commodity" and the media becomes a "commodity", then there will be no reason to distinguish between the real economy and the artificial one.
The cause of a commodity bubble is always an increase in supply, which leads to higher prices. It is not possible to predict when this will happen, but there are many signs that we are already in the middle of one. The most obvious example is Moore's law, which predicts that every year we will see more transistors being put into computers and more pixels being put on video screens.
The second sign that we are in a commodity bubble is high volatility - investors who have been following stocks for years suddenly decide they're not interested anymore because their favorite stocks have dropped by 20%. This has happened before (for example during the dot-com boom), but never at such a fast pace as now.

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