What's the next bubble?

myopic1 said:
I'm skeptical that there's a new property bubble though. The last one was of course fueled by credit but it's provision was due to there being incentives to supply credit by the creation of insane bond derivatives, created from said debt, that were as good as printing money on Wall Street. I could be wrong but I see the current trend in home price increases as being part of a 'rich outsiders' problem, with a landlord culture springing up from the willingness of Middle Eastern/Asian buyers to invest in prime real-estate in the US and UK.

I'd be interested to see how this is reflected now that oil millionaires/billionaires are taking a hit and the entire Chinese economy looks like a bubble.
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Well, if the insane amounts of money fueling into the real estate market isn't due to credit expansion again, then it would have to be from genuine wealth increase. I kinda doubt anyone would argue that the US/world wealth advanced by a 30% since 2011, so that leaves the "outside" money. My take is that they can't possibly amount to such a hike, especially when it's allover the board and not in a few handpicked cities - yet I haven't gotten into hard data, so that's just my estimation at this point.
 
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What I know 70% market depends upon the ups and downs of China's Market.YOu need to figure out first :)
 
I mentioned China in the original post because it had a large 18% BDP per capita growth 2-3 years ago. Now, it is stopping.

I could also be a just a normal economics cycle where recession and prosperity take turns.

But I am sort of scared as their market is taking a hit, investors are scared, they don't want to risk anything and the prices keep falling.
 
bollocks it's not stocks..yes they have gone up since 2009 until 2014 that was mostly Governement money but it has been no bubble. Nothing like the tech. or the bull market of 2003-2008. The stock market has actually come off the past 18 months+...so that's corrected.

The whole world is a bubble built on debt...get rich, die before it all really collapses.
 
dgusic said:
I could also be a just a normal economics cycle where recession and prosperity take turns.
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Yeah but the business cycle (that's the formal name for the ups and downs all across the economy) doesn't happen because (say) God happened to sneeze - there are tangible reasons that force the up and down. And the biggest one is the mis-allocation of capital, which, incidentally is mainly caused by credit expansion.
 
jazzc said:
Well, if the insane amounts of money fueling into the real estate market isn't due to credit expansion again, then it would have to be from genuine wealth increase. I kinda doubt anyone would argue that the US/world wealth advanced by a 30% since 2011, so that leaves the "outside" money. My take is that they can't possibly amount to such a hike, especially when it's allover the board and not in a few handpicked cities - yet I haven't gotten into hard data, so that's just my estimation at this point.
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Yes you're exactly right, my impression (and it's only that) is that the big cities are going to be skewing the data, so if you could see that 'Billy Bob' living in Nowhere town US, is now sitting on a house that has a highly inflated price, it suggests that it's systematic i.e free flowing credit or a shortage of housing (unlikely) rather than pockets of heavy outsider speculation.
 
jazzc said:
the mis-allocation of capital, which, incidentally is mainly caused by credit expansion.
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Exactly, who cares about the capital when you can have tons of it due to really cheap credits. Very low-interest rates in EU, thanks to expansionary monetary policy (THANK YOU ECB!). Europe could soon hit the liquidity trap.
 
Looks like I was exactly on the money with my prediction:

http://uk.businessinsider.com/linkedin-earnings-q4-2016-2?r=US&IR=T

LinkedIn's share price tumbles by 40%, investor sentiment is shifting and other 'unicorns'/startups are going to find it difficult to raise money with their absurd valuations, meaning the beginning of a viscous circle. Watch Twitter (that I mentioned last week) over the next month, I guarantee it'll follow, as will index's that track the market. The Nasdaq especially will take a hit in the coming weeks/months, it's lapped up tech companies like they're going out of fashion.
 
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