So, the S&P 500 is up 33% since April? Big freakin’ deal. The market's doing great? Tell that to the dude who just lost his job, or the small business owner who had to shutter their doors. This whole “recovery” smells like a rat in a Wall Street suit.
"Historically Expensive"? You Don't Say...
The Numbers Game is Rigged BofA Securities is saying U.S. equities are "historically expensive" on 19 out of 20 metrics? No freakin' kidding. Market Cap to GDP, Price to Book – all at record highs. It’s like they're not even trying to hide the fact that this is all smoke and mirrors. Who actually *benefits* from inflated asset prices anyway? The average Joe with a 401k? Give me a break. It's the same usual suspects: the ultra-rich, the corporations, and the damn algorithms that are probably running this whole charade. And global M&A volumes are down? Color me shocked. People are actually being cautious for once. Maybe, just maybe, some folks are starting to realize that throwing money at overpriced companies isn't the smartest move. Or maybe they just ran out of money to throw around.Tech Bubble 2.0: Goldman Sachs Full of It Again?
Tech Bubble 2.0? Don't Even Get Me Started. Tech's responsible for 32% of the global equity return since 2010? So, what you're saying is, we're completely reliant on a handful of companies that could implode tomorrow if some pimply-faced coder sneezes the wrong way. Peter Oppenheimer from Goldman Sachs wants us to believe it’s all "stronger fundamentals." Stronger fundamentals my ass. It's the same old story – hype, inflated valuations, and a whole lot of suckers waiting to get burned when the music stops. It's all a house of cards. A glitzy, app-filled, venture-capital-fueled house of cards, but a house of cards nonetheless. Remember the dot-com bubble? I do. I lost my shirt on Pets.com. Okay, not really, but you get the idea. Nicholas Colas has a three-point checklist for unhealthy markets: frothy IPOs, hallmark M&A deals, and asset prices doubling in three years. We ain't quite hit all three yet, but we're damn close. And Colas' rule about the S&P 500 doubling in three years? History says a decline is coming. So, why the hell is everyone acting like this is sustainable? You can learn more about how to identify these dangerous periods in How to Spot a Bubble in Stocks - Kiplinger."Diversify"? More Like Rearrange the Deck Chairs, Am I Right?
Diversify? Or Just Get Out? Oppenheimer recommends diversifying. That's like telling someone to rearrange the deck chairs on the Titanic. Diversify into what? More overvalued crap? Maybe stick some cash under your mattress. At least then you know it's safe from the vultures on Wall Street. But here's the thing...maybe I'm just being a grumpy old cynic. Maybe this time it *is* different. Maybe tech really *has* changed everything. Maybe the Fed can keep printing money forever and everything will be sunshine and rainbows. Yeah, and maybe pigs will fly. Wake Me Up When It Crashes