Say It With Me. We Are In An 'Everything' Bubble | Seeking Alpha
My regular readers know I have become quite cautious around the stock market right now. Equities are selling at extreme levels using numerous historical valuation metrics. However, U.S. stocks are not the only asset class trading at unreasonable levels. In today's column, I take a deeper look at the valuations of some of these assets. However, before I do, we should discuss one of the main drivers of these asset bubbles: the Federal Reserve. During Covid, the U.S. central bank chose to increase the money supply dramatically, by more than 25% in 2021 alone. FRED Nor was it the only time the Fed boosted the money supply significantly this century. The money supply is up just over 4.5% over the past year and has averaged 6.2% growth annually over the past two decades. The main reason inflation has not roughly equaled this rate over the past 20 years is the trillions of dollars held offshore as the greenback is the global reserve currency. In addition, in my opinion, the BLS's CPI reading
My regular readers know I have become quite cautious around the stock market right now. Equities are selling at extreme levels using numerous historical valuation metrics. However, U.S. stocks are not the only asset class trading at unreasonable levels. In today's column, I take a deeper look at the valuations of some of these assets. However, before I do, we should discuss one of the main drivers of these asset bubbles: the Federal Reserve. During Covid, the U.S. central bank chose to increase the money supply dramatically, by more than 25% in 2021 alone. FRED Nor was it the only time the Fed
Explore this link on the map →