Posted on 01/21/2022 5:11:10 PM PST by BenLurkin
Stocks are off to a tough start this year. The tech-heavy Nasdaq is already in a correction, a more than 10% drop.
Jeremy Grantham, co-founder and chief investment strategist of Grantham, Mayo, & van Otterloo (GMO) said in a report called "Let the Wild Rumpus Begin" that stocks are now in the midst of a "superbubble," that it won't end well.
He noted that US stocks have experienced two such "superbubbles" before: 1929, a market fall that led to the Great Depression, and again in 2000, when the dot-com bubble burst. He also said the US housing market was a "superbubble" in 2006 and that the 1989 Japanese stock and housing markets were both "superbubbles."
Grantham believes that the Federal Reserve's moves to cut rates to zero -- and then keep them there for nearly two years -- is a main cause for the market's current frothiness. The Fed is widely expected to begin raising rates at its March meeting. "One of the main reasons I deplore superbubbles -- and resent the Fed and other financial authorities for allowing and facilitating them -- is the under-recognized damage that bubbles cause as they deflate and mark down our wealth...To allow bubbles, let alone help them along, is simply bad economic policy..."
Other investing experts share some, but not all, of Grantham's concerns. Jordan Kahn, president and chief investment officer of ACM Funds...isn't as bearish as Grantham. Rather than an epic crash, he foresees a series of what he calls "bubble-ettes," mini manias in corners of the market such as crytpocurrencies and speculative, unprofitable tech stocks.
"There has been a lot of blind faith," Kahn said. "There are areas where there has been a lot of speculation and there will be pain there."
(Excerpt) Read more at cnn.com ...
Same. If you can't explain why people vote Democrat, you can appreciate the unpredictability of the market.
Don’t worry. The Market won’t crash. It’s waiting for me to get in, then crash. But I’m not gonna.
I think there will be a strong correction this year but where else you going to put your money?
I remember all the doom and gloom after the 2009 crash. I was told it would take 15 years to get back to 12,000 or whatever the high was before the crash and it came back in a year or less
Thanks,
I’m well positioned!
Every time I think of buying gold I remember the Gold Act of 1933. Maybe a good thing you lost yours.
😉
Hope all are in to cash.
Gonna be a lot of folks underwater when the housing bubble pops.
I did the same. Jumped in shortly after the COVID crash and did really well. Got out at Dow 29K anticipating a downturn once Biden was in office. Have regretted it immensely. Been looking for an entry point since, but just haven’t been able to trust the market. Something’s not right and I think we’ll find out soon.
Housing prices will go up for three years 2022-2025, then there will be a correction and a downturn in 2026, and then the prices will again go up in 2027 and then go way up. Ray Dalio: money is the tool of exchange with buying and selling. Credit allows people to buy and sell without money. Trump understood and delivered a strong economy.
Hedges with wrong bets blow up.
It’s due for a correction. But it’ll go back up. Republicans will be back in charge next year. We will continue to attract immigrants so our population will continue to grow despite a low birth rate. Covid-19 will become endemic so we’ll learn to live with it. Unemployed will have to return to work because their benefits will be cut off.
Huh?!
Am unfamiliar with that expression.
Meaning?
Regards,
with China and Russia and Ukraine, let alone countries like Ethiopia and Mexico in domestic war, and with buyden and the rats and cabal and the evil cdc, fda, etc, we are going to have a WORLD economic crisis, so why worry about our stock market because there is no safe place to put your money anyway, or so it seems.
On the eve of major inflation, people will move their money into investments which stand the best chance of keeping up.
I have no idea what to do.
Buy real estate. As Mark Twain observed, they’re not making any more of it.
Now GME is trading about $100. Most of the kiddies who got suckered into it by a few very sophisticated traders lost money.
“I have no idea what to do. “
Sometimes it’s ok to do nothing. Avoid the urge to always do something. That is a difficult thing for many. Pros know how to fold or step back from the table when there is too much uncertainty or no compelling favorable odds.
“Buy real estate. As Mark Twain observed, they’re not making any more of it.”
Well Mark Twain probably never drove from El Paso to San Antonio and eyeballed mile after mile of scrubby nothinness.
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