Minsky Moment

What Does Minsky Moment Mean?
A situation in which a market fails or falls into crisis after an extended period of market speculation or unsustainable growth. A Minsky Moment is based on the idea that periods of speculation, if long enough, will eventually lead to crises and the longer that speculation occurs the worse the crisis will be. This crisis is named after Hyman Minsky, an economist and professor famous for arguing the inherent instability of markets, especially bull markets. He felt that long bull markets only end in large collapses.

Investopedia explains Minsky Moment
The phrase "Minsky Moment" was coined by Paul McCulley in 1998, when referring to the Asian Debt Crisis of 1997, in which speculators put increasing pressure on dollar-pegged Asian currencies until the eventual collapse. These types of crises will occur because investors take on additional risk during prosperous times or bull markets. The longer a bull market lasts, the more risk is taken in the market. Eventually, so much risk is taken that instability ensues.

For example an investor might borrow funds to invest while the market is in an upswing. If the market slightly drops, leveraged assets might not cover the debts taken to acquire them. Soon after, lenders start calling in their loans. Speculative assets are hard to sell, so investors start selling less speculative ones to take care of the loans being called in. The selling of these investments means the market as a whole begins to decline. At this point the market is in a Minsky moment. The demand for liquidity might even force the country's central bank to intervene.