Ken: I'm afraid you're asking the wrong guy. Here on SI, where everybody and his brother is a fountain of confident (but usually wrong) macroeconomic predictions for both the long and short term, I don't pretend to have the slightest clue.
Yes, it sure looks like an unsustainable bubble to me. I don't believe there's anything really new when it comes to economics. The problem is that there are too many factors you can list on both sides of the questions of WHEN and HOW BAD it's going to pop, which is what really matters.
Ask one expert (e.g., among many others, the well-known Mr. Taurus of SI) and the answer is "Monday" and "civilization ends", and has been for the last several years (except on long weekends when the markets don't trade on Monday).
Ask another "expert", e.g., the Reliably Ebullient Joey Battapaglia, and productive baby boomers are pouring money into the market from the zenith of their earning potential, that inflation you think you see is a myth, productivity via cheap labor around the world is more than covering demand so we're actually in a deflationary global situation right now, innovation continues at a rapid clip, so the whole thing will go on forever.
Who's right? You pick 'em. I can't, except to say that it's probably not Monday. But just for grins, I cite below two articles from today's L.A. times both of which touch on issues you brought up: bond yield anomalies and another slant on the "new economy". Neither of them represents my own opinion, but I found them interesting.
Edit: call me a fuddy-duddy, but I own a lot of bonds.
Regards,
--QS
latimes.com
latimes.com |
