It's really hard to see how this all plays out. Some are calling for an outright stock market crash and recession and even deflation. Others are talking about the oddly similar charts with the 70s stagflation period. The enormous Federal debt adds another layer of concern, as our hands are somewhat tied to how we cope with economic crisis. Deflation MAY be the best outcome as painful as it is as it tends to reset prices to workable levels (like in housing and healthcare). That would break the back in the Federal debt though, forcing some kind of deleveraging or default (as inflation allows the government to kick that can down the road),or at least that's what I've been gathering of late. Interesting times!
Yeah, hard to predict the future. I do know that the 1930s, 1970s, and 2000s experienced two stock market crashes of over 30%. I personally expect something similar.
If it really starts tumbling I'd expect even 50 percent: delusional optimism to go to such extremes as now has a counterweight of delusional pessimism before stabilizing to reasonable P/Es
Yeah, if algos dump, passive dumps, and margin calls, easily. I think we *could* have two near 70% crashes over a decade. Back to covid lows, then testing 2008/2000 highs. I think that would be a harsh scenario, obviously.
Yeah, those are two very important signs before layoffs (another is weekly working hours, also coming down). And thank you, and unless we have some exogenous shock to sentiment, I truly think that's when the stock market reconnects to the economy.
It's really hard to see how this all plays out. Some are calling for an outright stock market crash and recession and even deflation. Others are talking about the oddly similar charts with the 70s stagflation period. The enormous Federal debt adds another layer of concern, as our hands are somewhat tied to how we cope with economic crisis. Deflation MAY be the best outcome as painful as it is as it tends to reset prices to workable levels (like in housing and healthcare). That would break the back in the Federal debt though, forcing some kind of deleveraging or default (as inflation allows the government to kick that can down the road),or at least that's what I've been gathering of late. Interesting times!
Yeah, hard to predict the future. I do know that the 1930s, 1970s, and 2000s experienced two stock market crashes of over 30%. I personally expect something similar.
If it really starts tumbling I'd expect even 50 percent: delusional optimism to go to such extremes as now has a counterweight of delusional pessimism before stabilizing to reasonable P/Es
Yeah, if algos dump, passive dumps, and margin calls, easily. I think we *could* have two near 70% crashes over a decade. Back to covid lows, then testing 2008/2000 highs. I think that would be a harsh scenario, obviously.
Yeah, those are two very important signs before layoffs (another is weekly working hours, also coming down). And thank you, and unless we have some exogenous shock to sentiment, I truly think that's when the stock market reconnects to the economy.