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Indicators show we’re in a Stock Bubble

“Stock brokers are seen at the stock exchange in New York,
Friday, Oct. 25, 1929 AP”

– “Are we in the third-biggest stock bubble in US history?”
“Stocks haven’t been this overvalued since the market peaks of 1999 and 1929, according to a new research report.”

“Here’s a quick question for you: What do the following years have in common?

1853, 1906, 1929, 1969, 1999

Pass the question around your office. Call your money manager and ask him or her, too. Post it on your office notice board.

Give up?

Those were the peaks of the five massive, generational stock-market bubbles in U.S. history.

Investors who bought into stocks around those peaks ended up earning terrible returns over the subsequent 30 years. Forget “stocks for the long run.” They ended up with “stocks for a long face.” The bigger the bubble, the worse returns.

And, according to a new research report, we are back there again.

U.S. stocks are now about 80 percent overvalued on certain key long-term measures, according to research by financial consultant Andrew Smithers, the chairman of Smithers & Co. and one of the few to warn about the bubble of the late 1990s at the time.

The five dates listed at the start of this article, he says, are the only times since 1802, when data began being tracked, when stocks have been 50 percent or more overvalued according to these measures. And only two of those bubbles — 1929 and 1999, both of which were followed by disastrous crashes — were bigger than today,” quoting Brett Arends, MarketWatch on MSN Money.
Read more

– “Ron Paul On The US Dollar CNBC 7/29/14”
“Ron Paul appears on CNBC and explains that increased stock prices coupled with decreased productivity is a strong indicator that we are in another economic bubble,” quoting The Liberty Crier.
Click here for the video.

Posted by Steve on August 6, 2014 at 6:30 am | Permalink

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