Editing Stock market bubble (section)

== Examples ==
Two famous early stock market bubbles were the [[Mississippi Company|Mississippi Scheme]] in France and the [[South Sea Company|South Sea bubble]] in England. Both bubbles came to an abrupt end in 1720, bankrupting thousands of unfortunate investors.  Those stories, and many others, are recounted in [[Charles Mackay (author)|Charles Mackay]]'s 1841 popular account, ''"[[Extraordinary Popular Delusions and the Madness of Crowds]]".''

[[Image:Nasdaq Composite dot-com bubble.svg|thumb|right|The [[NASDAQ Composite]] index spiked in the late 90s and then fell sharply as a result of the [[dot-com bubble]].]]
[[Image:Nikkei 225(1970-).svg|thumb|right|The [[Nikkei 225]].]]
The two most famous bubbles of the twentieth century, the bubble in American stocks in the 1920s just before the [[Wall Street crash of 1929]] and the following [[Great Depression]], and the [[Dot-com bubble]] of the late 1990s, were based on speculative activity surrounding the development of new technologies.  The 1920s saw the widespread introduction of a range of technological innovations including [[radio]], [[automobiles]], [[aviation]] and the deployment of [[electrical power grid]]s. The 1990s was the decade when Internet and e-commerce technologies emerged—many of which had minimal sales and earnings profiles. 

Other stock market bubbles of note include the [[Encilhamento]] occurred in Brazil during the late 1880s and early 1890s, the [[Nifty Fifty]] stocks in the early 1970s, [[Economy of Taiwan|Taiwanese]] stocks in 1987–89 and [[Japanese asset price bubble|Japanese stocks in the late 1980s]].

Stock market bubbles frequently produce hot markets in [[initial public offering]]s, since investment bankers and their clients see opportunities to float new stock issues at inflated prices.  These hot IPO markets misallocate investment funds to areas dictated by speculative trends, rather than to enterprises generating longstanding economic value.  Typically when there is an over abundance of IPOs in a bubble market, a large portion of the IPO companies fail completely, never achieve what is promised to the investors, or can even be vehicles for fraud.