Bubbles - In today’s world platform, investors are alongside sovereign nations pumping funds into real estate, stocks, bonds, currencies on a global basis creating the largest asset bubbles in the history of all mankind.
To understand what is happening, one needs to first examine a bubble.
What is a bubble?(click)
A bubble is an economic cycle characterized by the rapid escalation of asset prices followed by a contraction. It is created by a surge in asset prices unwarranted by the fundamentals of the asset and driven by exuberant market behavior. When no more investors are willing to buy at the elevated price, a massive sell-off occurs, causing the bubble to deflate.
The Bond Market Bubble: Fact or Fiction? (click here)
There has been ongoing talk of a “bubble” in the bond market, which has been documented in the media, such as in an article written by noted finance professor Jeremy Siegel of the Wharton School at the University of Pennsylvania.
Called “The Great American Bond Bubble,” the article described an environment where bonds were thought to be artificially high, although actual returns didn't seem to support this. Talk of a bubble comes in and out of the media, which can cause unrest among investors who have concern about their portfolio.
Understanding more about a bond bubble can help you consider whether you need to make any changes to your investment portfolio.
Is the Real Estate Market Going to Crash? (click here)
Know the Warning Signs and What You Should Do Now
Most Americans are concerned that the real estate market is going to crash. A recent survey found that 58% agreed that there would be a "housing bubble and price correction" by 2020. As a result, 83% of them believe it's a good time to sell.
Warning Signs of a Bubble
There are plenty of signs that the housing market has been in bubble territory. Most crashes occur only because an asset bubble has popped.
One sign of an asset bubble is that home prices have escalated. National median family home prices are 32% higher than inflation. That's similar to 2005, when they were 35% overvalued.
This means it’s harder today to diversify against a downturn that can hit almost all markets.
So, something different clearly is going on in this modern period with its unique serial bubbles.
Actually, a lot of things, but with a common characteristic: a lot money has been sloughing around and into the United States — sources ranging from unprecedented rises in government debt-to-GDP and Fed forays into purchasing mortgage-backed securities to sovereign banks, investors, and oligarchs abroad attracted by the stability of the dollar and a rule of law.
Davos 2019 - When the Corporate Debt Bubble Bursts (click here)
Hedge Fund Legend Ray Dalio On The Economy (click here)
Ray Dalio Says It's Time to Buy Gold (click here)
International Monetary Reset (click here)