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I agree with you. I'll put it another way. Usually if the price of something goes up and becomes too high, fewer people buy and the price drops. That is a stable system. An unstable system is when the price of something goes up, so that causes more people to buy causing the price to go up more. That is an unstable system causing exponential growth, which I'd call a bubble.

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Is the lesson learned that people are irrational gamblers?

I think the lesson learned is that the system is setup to encourage this kind of bandwagon investment. For example, all the people who are buying houses as a vehicle towards financial security: completely rational within the confines of the system we have. But causing huge problems, and therefore something that shouldn't be incentivised.

I'm seeing it in the sense of gambling: I buy when I think it's going to go up, you sell because you think it's going to go down (stocks), but people don't think, they just get excited, bubble happens, then we get a small minority winning big and the majority losing.

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