Tag Archives: stock market bubble

The U.S. economy is literally on perpetual life support. Recent events show too clearly that unless fiscal and monetary stimulus continues, the economy will fail and, by extension, the stock market...

Never before in history have we had a stretch like this without major economic and financial consequences...History has shown that every bubble bursts eventually, and when this bubble bursts, it is going to make 2008 look like a walk in the park.

We believe what we believe will make us rich, what feeds our euphoric confidence that the bubble-music will never stop and our credulity that bubbles which we know will pop will not pop until we've safely cashed out.

If you believe this time is different and you can’t see how over-valued the Dow Index is based upon the MACD technical, then maybe it might be prudent to allow a Doctor to take a Cat-Scan to find out if you have any brains left in your head!

If your complacency and procrastination prevent you from realizing the truly dangerous bubble in equities right now, here are 8 of the most salient reasons why you’ll definitely need to find the nearest emergency exit before this fall.

What you need to know is that current stock market valuations are not sustainable and that a great crash is coming. It may not happen next week or next month, but it is going to happen, and when it does happen, it is likely to make what happened in 2008 look like a Sunday picnic.

Throughout U.S. history, every giant financial bubble has always ended very badly, and this time around will not be any exception. Trump may get the blame for it when it bursts, but the truth is that the conditions for the coming crisis have been building for a very, very long time.

A bubble is the state of a market before the crash. It is a situation in which assets trade at a price that is considerably higher than their intrinsic value and, in my view we're currently in a bubble. The current S&P 500 P/E is at 25.09 (when the historical average is 15.61). The question is, "When will the market crash?" and I see worrying signs that this could happen soon.

Let’s imagine the stock market as a whole bunch of balloons. One or two can pop loudly and everyone will jump and then laugh it off but, eventually, enough balloons will pop that the weight of the debris overwhelms the remaining balloons’ ability to keep the string aloft. Then your whole bunch falls down. In like manner, some kind of catalyst sets off every market collapse.The last balloon to pop isn’t any bigger or smaller than the others; it just happens to be last. What are some candidates for that last balloon?

In their infinite wisdom the Fed thinks they have rescued the economy by inflating asset prices and creating a so called "wealth affect". In reality they have created the conditions for the next Great Depression and now it's just a matter of time...[until] the forces of regression collapse this parabolic structure. When they do it will drag the global economy into the next depression. Let me explain further.