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Is there any systematic way to detect the Boom, bust and Recovery cycles in Asset Prices ? Are there any good references about the Topic ?

Thanks in advance.

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  • $\begingroup$ After every boom-bust cycle there is a lot written about how it developed, what were the causes,etc. For example there is a lot about the housing bubble of mid 2000's in US, Ireland, Spain. It can be interesting but is descriptive and backward looking and IMHO not very useful (sometimes even counterproductive) in detecting the next cycle. There are some stats you can look at (loan to value ratios, growth in mortgage credit) but no general guidelines AFAIK. Every cycle is different, the "general theory of cycles" does not exist yet. $\endgroup$
    – Alex C
    Dec 9, 2019 at 0:30

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Hi there and welcome to the forum. I can't say for recovery cycles, but I used this paper (https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3299498) on a project for a master's course. It is mostly about bubble and crisis prediction with an econometric model, I guess that corresponds to your boom and busts.

Hopefully this helps!

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