Is a new stock-market bubble being formed right now?
My answer to that question is YES ! All we know right now is there are huge unknowns in the economy and the path ahead is widely uncertain, making any prognostic is quite dicey. However, is pretty clear is that the economy is experiencing an epic collapse of economic activity that has set in motion problems that will play out over many years. We are in the most severe recession in a century and we will experience a halting recovery with a potential second wave of the virus coming up. So, is the stock market going nuts? Allow me to pinpoint some facts that shore up my sentiments that the market has entered a Bubble. 1. Index Consumer Sentiment The stock market and consumer sentiment are telling different stories, the stocks have rebound off March lows, while sentiment is near the lowest level in nearly a decade. This divergence breaks a long term link between the stocks and ICS. The consumer index is a well-know indicator that measures how optimistic consumers feel about ...