As I warned in the prior article about a parabolic mania, things as of this morning have not gotten any better. There is an inherent rot underneath the floor to this part of the bull market and it’s quite simple:
Everyone is turning a blind eye to the massive amounts of private and government debt being accumulated by our society.
This will not end well.
I expect another fantastic piece of fiction from the BLS on Friday but few economists actually commenting on the poor underlying data about participation and wages. This will change eventually but at the moment it is all about maintaining the vaccine and recovery narrative to support an illegitimate President.
When I finish my major project for work, I shall post a long essay on why a 50-60% full on bear market in not just equities and commodities, but cryptocurrencies also is in the cards. In addition, once this bear roars, lookout below for real estate as homes are being greatly over valued and people are buying like its 2005 all over again. This bear market, triggered by irrational exuberence and government overreach will remind everyone of 2008 and 1979 all in one shot, with hyperinflation (transitory mind you) in one corner along with asset price collapse in the other.
Buckle up. This will get very ugly, sooner than many think.