I don't really like making predictions on markets, because of the massive amount of state interference I've seen over the past 20 years or so.
The real estate market is definitely a bubble. That shoeshine boy indicator is almost the definition of one. Usually paired with sketchy credit used to buy whatever. However, there are parts of the real estate market that are actively crashing, commercial real estate comes to mind. No tenants and interest rates that have gone higher than they planned for. I zoom out and I just see a picture of utter imbalance. Too much real estate where it's not needed and too little where it is. State interference. And you can bet (and this is about the only prediction I'll make) that the state will interfere when the bubble pops. They did last time.
The stock market? There's several scenarios I'd point out. One of them is Venezuela/Zimbabwe. Just take a look at a historical chart and sit and think about it. The other would be the Dow historical through the 70s. Up and down and up and down between 1000 and 500, going essentially nowhere (didn't the BeeGees sing about that?) as cars (and a bunch of other things) quadrupled in price. In any case, you don't trade constant dollar prices, you only trade what's on the ticker and nothing else.
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branchandroot
(no subject)
Date: 2024-05-19 01:57 pm (UTC)The real estate market is definitely a bubble. That shoeshine boy indicator is almost the definition of one. Usually paired with sketchy credit used to buy whatever. However, there are parts of the real estate market that are actively crashing, commercial real estate comes to mind. No tenants and interest rates that have gone higher than they planned for. I zoom out and I just see a picture of utter imbalance. Too much real estate where it's not needed and too little where it is. State interference. And you can bet (and this is about the only prediction I'll make) that the state will interfere when the bubble pops. They did last time.
The stock market? There's several scenarios I'd point out. One of them is Venezuela/Zimbabwe. Just take a look at a historical chart and sit and think about it. The other would be the Dow historical through the 70s. Up and down and up and down between 1000 and 500, going essentially nowhere (didn't the BeeGees sing about that?) as cars (and a bunch of other things) quadrupled in price. In any case, you don't trade constant dollar prices, you only trade what's on the ticker and nothing else.