One thing that very much controls bubble conditions is ease of money generation. When interest rates drop, money supply greatly increases. When money is easy to generate (crypto mining before halvenings), bubbles form. When it’s hard to generate money, bubbles deflate or pop. When you are full speed in easy money generation, the switch to hard to generate money can be sudden and jarring.
The FED interest rate controls our economy much more than in the past because we have easier access to credit than in the past. Generating money with an interest rate drop is simply a matter of refinancing or letting your credit limit increase… very little work. I remember reading in early 2020 before prices rose that the Fed dropping the rate in 2020 would increase home prices 16% (not based on supply demand, simply on interest rates - guaranteed 16% instant gain). Once this caught on, home prices increased 30-40%. Now with rates up, free money or easy to generate money is gone, but there is always a lag in the popping or topping out. From the point you know that money has become hard to generate to when prices drop can be awhile. This lag is why market timing is hard and although you know the trend direction, it can be surprising how deep or shallow the bear or bull market goes.
I think ease of money generation has drastically decreased with interest rates. Also crypto is decreasing in ease of money generation every time they have a mining halving. Suddenly when people notice that it’s harder to make money than they got used to, that’s when the pop will happen. We are in the aware, but still rolling phase.
The one big wildcard is how locking in 30 year mortgages at low interest rates protects people from the new environment of high rates. They locked in easy money generation and every payment they are “creating” money with their locked in savings. You can’t easily take away the extra $500-1000 people have every month because of their locked in mortgage. This is creating two groups, one group with easy money generation and the other with hard money generation.