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How investing works

Lesson 29 · Written for kid, teen, and little

Famous bubbles and crashes

Real stories of hype gone wrong.

The idea

Excitement about an investment can send its price up quickly. People may buy because they expect someone else to pay even more. That kind of enthusiasm can become a bubble: if expectations change, prices can fall sharply and buyers can lose money. Past episodes can teach us about risk, but recognizing a familiar story does not tell us when prices will turn or protect us from losses. 🫧

A

Words to know

5

Bubble

When the price of something climbs far above what it's actually worth, driven by hype.

Crash

A sudden, sharp drop in prices, often right after a bubble pops.

Tulip Mania

A 1630s bubble in the Netherlands where single tulip bulbs sold for the price of a house.

Dot-com bubble

Around 2000, internet companies with no profits were valued in the billions, then collapsed.

Short squeeze

When a stock shoots up fast as people betting against it are forced to buy, like GameStop in 2021.

Try it — no accountTrue or false

Swipe RIGHT if this REALLY happened in history. Swipe LEFT if it sounds made up.

Card 1 of 4

In the 1600s, one Dutch tulip bulb cost as much as a HOUSE.

Swipe the card — or tap.

In the full lesson

  1. 1True or false

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