How to spot a bubble bursting

Dec 1st 2025|5 min read

Ray Dalio spied the dotcom bubble early. “We’re approaching a blow-off phase of the US stockmarket,” said the founder of Bridgewater, one of the world’s biggest hedge funds. Peter Lynch, the celebrated manager of Fidelity’s Magellan fund, thought “not enough investors are worried”. Howard Marks, a pioneering investor in junk bonds, very much was worried, since “every cocktail-party guest and cab driver just wants to talk about hot stocks and funds.” George Soros put his neck on the line and short-sold internet stocks outright. Warren Buffett refused to touch them, saying he could not “see what technology businesses will look like in ten years or who the market leaders will be”.