The origins of asset price bubbles

The literature 1 mostly offers four explanations for the appearance of asset price bubbles: Rational bubbles; An asymmetry that leads optimists to always prevail over pessimists; The amplification of asset price fluctuations by wealth effects; “Extrapolation bias”. We can certainly add to this: The wealth effects that result from monetary policies; The impossibility of making an actuarial calculation when long-term interest rates are lower than the growth rate. 1 See for example the survey by A. Simsek; “The Macroeconomics of Financial Speculation”, NBER Working Paper no. 28426, February 2021.