He makes a compelling case for a big crash although it has to be said the whole book is very one sided. Has anyone else who has read this book got any thoughts on it and the likelihood of a big crash coming in the next few years?
For my part I am feeling bearish about most stocks at the minute. I get the impression growth is slowing in the US and will soon peak here in the UK sending us back into another depression. Given the current debt excesses in the US, and here, I think it will take only another big event such as 9/11 (god hope it never happens again) and markets could drop like a stone at the minute. I suppose what i'm trying to stay is I don't see much propping up stocks in the near to medium future. My opinion only...
Are we approaching financial Armaggeddon? I doubt it. Has the performance of the markets over the last 50 years been historically exceptional? I believe so. Will we see one major crash to bring us back to the LONG term trend? Extremely unlikely. Will we see a series of long bear markets with quite convincing bear market rallies over the next 20+ years? Quite possibly. Is anyone really interested in the outlook for the stock-market over the next 50 years? I've yet to find a single person.
Maybe that is because a lot of people who are trading now are new to the market..The winners are few and far between, so they haven't experienced the booms and busts and survived.
You can't get away from crowds and behaviour and that is the stock markets....
Fear and greed
Traders don't care if the market is moving up or down, just that it's moving. I've mentioned my findings to a few market commentators that I respect (which isn't very many), and even they didn't seem to be at all interested. But I sleep well enough: forewarned is forearmed and all that.
PS BTW I believe that fear is a stronger emotion than greed.