How to tell if the Bubble is about to pop... In general there are four ways to tell if a stock market bubble is leaking: Higher interest rates. High interest rates killed the Japanese bubble of the 1980s. A symbolic, faltering leader. Pan American Airways issued convertibles at higher and higher coupons on the way out. Watch the convertibles for companies like Amazon.com. Look at the cash-burn rates of companies that are losing money. How many months are left until a leading company runs through its cash? Watch for insider selling -- or buying. Fortunes have been made quickly on paper -- we don't want to buy the paper of the founders. Warren Buffett doesn't sell Berkshire Hathaway. The name Adam Smith and the logo of Adam Smith are marks Registered in the United States Patent and Trademark Office. Copyright ©2000 Adam Smith Educational Productions Ltd.

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