History always repeat itself

I must admit, I never liked studying history in school. I will always asked myself "History is always about dates and events of people so long ago, so what's the point of learning them?"

But recently, I have learned to appreciate what it means when people say 'history repeats itself'... particularly in the financial markets where bubbles and fraud occurs.

In the book / documentary the 'Ascent of Money', author and academic Dr Niall Ferguson went through the history of money, loan, bonds, stock market, and insurance. He discussed how financial markets soar and eventually crashed in numerous accounts. If there's a theme I can gather, then it all comes down to greed and fear.

The idea that fear and greed causing chaos in the financial market is common knowledge but here's my take on what I have learned from history. It always start with a couple of guys coming together with a radical idea, they had a go good at it and things took off. Soon they realised the amount of money they are making, they wanted more and pushed it further. At some point, their idea / model became unsustainable and cracks start to appear. At this point, market prices are still going crazy and everybody wants a piece of it. This is where covering up and manipulation happens. For me, this point is the key. When the fundamentals are no longer there, all it takes is a couple of small events and it send a chain of domino effect. Things will go wrong very badly and very quickly.

If history always repeat itself, then I think there must be signs before the next bubble occurs. One just need to know where to look and what to look.

I don't have the answer to this but I can share my own starting point to figuring out the answer:

• Don't reply on your local newspaper for information. By the time local media reports it, I think it is too late. 
• Focus on Fundamentals: I believe that every country, industry, company even individuals can be assessed using fundamentals (i.e. a unique set of financial measures). The key is to figure out what is the Credit Risk. In other words, what's the likelihood of it going into trouble and seeking financial assistance externally. Companies can raised debt or issue equity. Individuals can apply for a personal loan or home loan. Government can issue bonds. 

Most may argue that debt is not necessary a bad thing, but excessive debt is definitely bad because it will  reach a point that things becomes unsustainable.