READOS / Business
Booms, Bubbles and Business Cycles
How credit, asset prices and confidence create booms and busts, and how a business stays sound through them.
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- 01The anatomy of a bubble: from displacement to panicAsset bubbles tend to follow the same broad stages, from a new opportunity through boom, euphoria and revulsion. Understanding the pattern helps you recognise where a market stands.
- 02Credit: the fuel behind every bubbleMost damaging bubbles are financed with borrowed money. How lending, new lenders, low real interest rates and rising debt turn a boom into a bubble, and why credit makes the bust worse.
- 03Housing booms: what drives them and how to read themHousing is most households' largest asset and a major driver of the economy. What pushes house prices up, how to judge whether a housing boom has become stretched, and what it means for businesses.
- 04Bubbles, strong currencies and capital flowsMost bubbles come with a strong currency or a flood of foreign money. Why capital inflows and asset booms reinforce each other, how they reverse, and what it means for importers and exporters.
- 05Wealth effects: how rising asset prices change the way people spendWhen shares or homes rise in value, people feel richer and often spend more, save less or borrow. How wealth effects work, why they reverse, and what they mean for businesses.
- 06Rising prices or a bubble? Why valuation is the best clueStrong price rises do not prove a bubble. Comparing prices with earnings, rents and incomes, against history and against reason, gives the best evidence of how stretched a market is.
- 07Warning signs of a bubble: a practical checklistNo single signal proves a bubble, but certain warning signs tend to appear together. A grouped checklist for judging whether a boom has become dangerous.
- 08After the peak: what happens when a bubble burstsWhen a bubble bursts, falling prices, distressed borrowers, cautious banks and wary consumers can turn a market correction into a recession. How the bust unfolds and how recovery comes.
- 09Borrowing against a boom: leverage, equity withdrawal and riskRising asset prices make it easy to borrow against homes and investments. How leverage magnifies gains and losses, why boom-time borrowing is so risky, and how to keep it safe.
- 10Running a business through a boom and bustBooms tempt businesses to over-expand, borrow and extrapolate demand; busts punish them for it. A practical guide to building a business that benefits from good times and survives bad ones.
- 11Waiting for normal: how to tell a cyclical dip from structural changeAfter a shock, asking when things will return to normal can be the costliest assumption. How to tell temporary dips from lasting change, match how you manage to it and act without certainty.
- 12When the economics change: reposition, transform, contain or exitWhen customers, channels and costs no longer support a business model, working harder rarely fixes it. How to diagnose the change and choose to reposition, transform, contain or exit.
- 13Steering a small business through a downturn: cash runway, cost review, recovery plans and pivotsA practical turnaround guide for small businesses facing falling sales or losses: scenario planning, cash runway, a 13-week cash forecast, cost review, working capital, people and pivots.
These topic-based reading collections are organised alphabetically; chapters may be read in any order.
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