Asset prices are high across the board
economist.com
Asset prices are high across the board
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Re: Asset prices are high across the board
#2There is almost not a week without an article in the Economist or/and the FT about us reaching the peak of the market. I can't help thinking that it starts to look like 2006 again.
Re: Asset prices are high across the board
#3Unfortunately I cannot access the article... could anyone summarize the content? Thanks
Re: Asset prices are high across the board
#4Joe Kennedy supposedly said he avoided the stock crash of 1929 by getting out of the market when his shoeshiner started giving him stock tips.
Multiple times recently I’ve been at restaurants recently overhearing people talk about how much money they’re going to make in Bitcoin. It’s hard to convey here, but the make-money-who-cares-how-it’s-magic came across every time in such a wow-this-is-definitely-a-bubble way.
But as they say, markets can remain irrational longer than you cane remain solvent.
Re: Asset prices are high across the board
#5Joe Kennedy supposedly said he avoided the stock crash of 1929 by getting out of the market when his shoeshiner started giving him stock tips. Multiple times recently I’ve been at restaurants recently overhearing people talk about how much money they’re going to make in Bitcoin. It’s hard to convey here, but the make-money-who-cares-how-it’s-magic came across every time in such a wow-this-is-definitely-a-bubble way.…
As far as the stock market goes, sentiment has not yet reached a peak. There are still a lot of what I call the "wise naysayer" on CNBC and elsewhere, claiming that we are due for a big decline, or even a crash. Until there are no naysayers left, the chances of further climbs is supported by sentiment analysis.
Re: Asset prices are high across the board
#6My projection is that this is resulting from a lot of circular investing. Fund A gives money to company B, who has more money than they can spend so it goes to fund C, and then that goes to company D, etc.
We've learned that you are not supposed to have idle capital. And yet we keep so much of our wealth as money, the only way to deploy it is to send it in a circle. Valuations go up, prices and costs don't.
Unfortunately it's a house of cards. When someone finally cashes out, they'll pull money from the whole system to the tune of the amount it's been amplified by circular investing.
There will be an ugly correction.
Re: Asset prices are high across the board
#7There is almost not a week without an article in the Economist or/and the FT about us reaching the peak of the market. I can't help thinking that it starts to look like 2006 again.
But there is also not a week that goes by without an "expert" in the financial media claiming we are due for a crash. Until there are fewer of these "warnings", the market could very well just keep on truckin.
Re: Asset prices are high across the board
#8Joe Kennedy supposedly said he avoided the stock crash of 1929 by getting out of the market when his shoeshiner started giving him stock tips. Multiple times recently I’ve been at restaurants recently overhearing people talk about how much money they’re going to make in Bitcoin. It’s hard to convey here, but the make-money-who-cares-how-it’s-magic came across every time in such a wow-this-is-definitely-a-bubble way.…
The Palo Alto equivalent (which I've seen) is "the bartender gives 3D printing pitches"
Re: Asset prices are high across the board
#9My projection is that this is resulting from a lot of circular investing. Fund A gives money to company B, who has more money than they can spend so it goes to fund C, and then that goes to company D, etc. We've learned that you are not supposed to have idle capital. And yet we keep so much of our wealth as money, the only way to deploy it is to send it in a circle. Valuations go up, prices and costs don't. Unfortuna…
That end is called raising the interest rate. When the rate hits some magic phase transition number where enough people believe you can invest in safe liquid accounts for more than the return on risky assets then the whole thing collapses.
But then it'll get propped up again afterwards and everybody believes that now.
Re: Asset prices are high across the board
#10Interesting to note that dollar adjusted the market has actually been going down for months.
http://ei.marketwatch.com/Multimedia/2017/10/04/Photos/NS/MW...
