Time to Say Goodbye to The Everything Bubble
The comments below are an edited and abridged synopsis of an article by Egon von Greyerz
Will the autumn of 2021 be the end of the everything bubble? Are investment markets coming to the end of market insanity?
Since there is little sanity left in markets or in the world economy, we have reached a point where we must accept madness as sanity. As George Bernard Shaw said, “When the world goes mad, one must accept madness as sanity; since sanity is, in the last analysis, nothing but the madness on which the whole world happens to agree.”
Investment markets today are all about instant gratification and getting rich quick.
Stocks always go up, and so does property in the everything bubble. Even the normally boring bond market has had a 40-year rise. And then we have the supercharged tech stocks, many of which have gained unbelievable amounts.
And don’t forget the SPAC stocks (Special Purpose Acquisition Companies) or blank-cheque companies where shell companies are used to acquire existing companies to inflate their share price.
None of these things are new, of course. During the South Sea Bubble in the 1720s, for example, companies were formed and capital raised with just the purpose of making money.
Don’t forget the cryptocurrencies that are now worth around $2 trillion. They were just over $1 billion eight years ago. Is that the bubble of the century, like tulip bulbs in the 1600s, or is it the money of the future?
Up for discussion: Value investing and wealth preservation is for wimps; at the end of an era—falls of 90%; illusions are just illusions; the Buffett Indicator; surviving the everything bubble is all about protecting from risk; and gold.