I've just finished this book - "Bubbles and How to Survive Them", and it's joined Manias, Panics and Crashes as one of my all-time favorites

The author John P. Calverley does a great job talking about what makes a bubble, what to look for, how leaders react, what to expect from the central banks, what the impact is on inflation and the currency, and how to preserve your wealth when the masses go mad and then recover their sanity one by one.

Some of my favorite quotes:
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"At some stage the bubble reaches a phase variously called euphoria or mania, where speculation mounts on top of genuine investment and expectations for potential returns reach wild heights. Strong market performance is extrapolated endlessly forward and any consideration of fundamental valuation criteria is swept aside"

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"The worst point of the Depression came in March 1933, when the wave of bank failures led to a general panic and the closure of all banks. The Dow Jones index actually bottomed before then with the close on July 8th, 1932 at 41.88, a drop of 90 percent from its peak."

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"Governments have even less interest in drawing attention to the dangers of asset bubbles. Voters generally like bubbles. Many people profit from them, though for some the gains turn out to be only on paper and disappear later... But in general it is easy to win elections during bubble periods, because people feel wealthy and the economy is doing well."

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In the end the author calls for an "Asset Evaluation Committee" and a warning system for when our financial system (stocks, bonds, real estate, etc) venture into bubble territory, so at least investors are warned. I like the idea, and instead of a committee of humans, I'd recommend a computer. The fundamentals are the fundamentals, and when people are paying 8 times income for a house, it's a bubble. When stocks' P/E is 40, it's a bubble. When renting is a fraction of the cost of "owning", it's a bubble. When people are camping out to buy an asset, it's a bubble.

Give us a nice color coded warning system, instead of Greenspan's "Froth" or "Irrational Exuberance" parlance, and even the masses will get it.

I highly recommend this book for all HP'ers. You owe it to yourself. Then pick up "Crash Proof" by Peter Schiff so you know how to invest, and for god's sake read Manias, Panics and Crashes. I'm not that smart - everything I predicted came from reading that one classic book.