The Biggest Bubble Ever Is Just Getting Started: History Repeating Itself

We’re living in truly unprecedented times.

The coronavirus tipped off the sharpest stock sell-off since the Great Depression.

At one point, stocks were down 35% from their February highs.

The economy is also suffering the biggest shock in history.

The number of workers filing for unemployment hit 6.65 million on Thursday.  That’s up from only 281,000 just two weeks ago.

John Harwood of CNN Business likened it to a “nuclear bomb being dropped on the American economy.”

And it’s going to get worse before it gets better.

But someday, we’ll emerge from our homes and start to get the economy back on track.

And the beginning of the mother of all financial bubbles will be upon us…

The Fed’s Full Range of Tools

Bubbles all start the same way.

They’re all grounded in the easy-money policies that have been provided by the central banks for decades.

This time will be no different.

To understand the roots from where the next bubble will originate, I took a deep dive into the recent stimulus measures undertaken by the Federal Reserve.

The gist of the Fed’s actions is contained in the first sentence of its recent news release.

The Fed is “committed to using its full range of tools to support households, businesses and the U.S. economy overall.”

This begs the question … what does the Fed mean by “its full range of tools”?

These Aren’t Normal Times

Remember, it’s the central bank that creates money.

In normal times, the Fed’s toolbox contains a lever that lowers interest rates to fight off a recession or raises interest rates to slow down inflation.

Lowering interest rates encourage banks to lend and businesses to borrow, leading to economic expansion.

Raising interest rates reverses this process and is used to curtail inflationary pressures.

But these aren’t normal times.

Once the Fed lowers rates to zero, as it did last month, the value of this tool loses its luster.

Zero percent interest rates only work if banks are still willing to lend money. And they’re not effective if lenders are demanding a huge premium.

That’s what we started to see happen as prices of the existing mortgage and corporate bonds sold off sharply.

If corporations can’t roll over debt at low rates, the cost of capital rises and economic growth slows down.

So, the Fed reached into its toolbox and pulled out something else…

Quantitative easing.

Quantitative Easing Is a Bazooka

This is the unconventional process by which the central bank purchases longer-dated securities in order to increase the money supply and encourage lending and investing.

If lowering interest rates is a pistol, quantitative easing is a bazooka.

The Fed was already committed to buying vast quantities of U.S. government bonds and mortgage debt that’s backed by government agencies such as Fannie Mae and Freddie Mac.

It has now loaded a bigger rocket in the bazooka with a promise to keep buying “in the amounts needed to support smooth market functioning.”

But it didn’t even stop there.

The Fed announced its support for debt issued by companies, state and local governments and other entities. Although it did stop short of buying municipal debt directly.

No One Knows When the Crisis Will End

The issue in the credit markets is the same issue that’s playing out in the stock markets. No one has any clue how bad the pandemic will be or how long it will last.

For example, look at the range of forecasts from Wall Street economists for second-quarter gross domestic product growth:

Because of this uncertainty, primary dealers in the bond markets (J.P. Morgan Chase, Citigroup, Goldman Sachs, etc.) lowered the amount of risk taking, leading to a frozen credit market.

By doing whatever is necessary to buy debt, the Fed is jumpstarting these markets again.

And it will ignite a new speculative bubble, just as we’ve seen after past easy-money episodes.

This Next Bubble Will Be Bigger Than the Rest

In 1998, the Fed lowered interest rates after the Asian crisis, and the dot-com bubble was ignited.

When dot-com imploded, the Fed cut interest rates to save the economy, and that inflated the housing bubble. This led to the financial crisis.

To combat the financial crisis, the Fed cut rates to zero and started quantitative easing. These tools led to spectacular growth in tech companies such as Amazon, Google and Apple.

Low rates inflated the venture capital markets, creating herds of “unicorns” (a Silicon Valley word for startups with $1 billion valuations).

While I’m not yet sure which asset class will be the prime beneficiary of this next bubble, it’s going to be bigger than all the rest.

Regards,

Ian King

Editor, Automatic Fortunes

Sources: 

John Harwood of CNN Busines

Previous Post
Next Post

Comments

Mega Arise Max

Hi there to every body, it’s my first pay a visit
of this blog; this web site includes remarkable
and in fact excellent data for readers.

my web blog :: Mega Arise Max

Jolly CBD

I like this website so much, saved to bookmarks.

my site: Jolly CBD

Green CBD Gummies Review

Thanks a bunch for sharing this with all people you really know what you’re talking approximately!
Bookmarked. Please additionally consult with my website =).
We will have a link change agreement between us

Review my website … Green CBD Gummies Review

cgi.www5a.biglobe.ne.jp

I used to be recommended this website via my
cousin. I am not positive whether or not this submit is
written by means of him as nobody else understand such specific about
my difficulty. You’re amazing! Thanks!

Also visit my webpage :: cgi.www5a.biglobe.ne.jp

l.iv.eli.ne.s.swxzuhu.feng.ku.angn.i.ub.i...u.k37

If some one desires expert view about blogging and
site-building then i propose him/her to visit
this website, Keep up the fastidious job.

Visit my web-site: l.iv.eli.ne.s.swxzuhu.feng.ku.angn.i.ub.i…u.k37

Quit Smoking Gummies Price

Purely to follow up on the update of this matter on your blog and would
want to let you know simply how much I prized the time you took to publish this beneficial post.

Inside the post, you actually spoke on how to seriously handle this problem with all convenience.
It would be my personal pleasure to build up
some more tips from your web site and come up to offer some others
what I learned from you. Thank you for your usual terrific
effort.

Here is my site; Quit Smoking Gummies Price

bbq-grill-recipes.com

Great blog! Do you have any recommendations for
aspiring writers? I’m hoping to start my own blog soon but I’m
a little lost on everything. Would you suggest starting
with a free platform like WordPress or go for a paid option? There are so many options out there that I’m completely confused
.. Any recommendations? Thank you!

Also visit my blog; bbq-grill-recipes.com

rucame.club

Sweet internet site, super style and design, really clean and
utilize genial.

Stop by my web blog … rucame.club

https://mpc-install.com

Magnificent goods from you, man. I’ve understand your stuff previous to and you’re just extremely magnificent.
I really like what you have acquired here, certainly
like what you’re saying and the way in which you
say it. You make it entertaining and you still care for to
keep it sensible. I cant wait to read much more from you.
This is actually a great website.

Look at my web site: https://mpc-install.com

https://mpc-install.com/punbb-1.4.6/viewtopic.php?id=689837

Heya i’m for the first time here. I came across this board and I in finding It really
useful & it helped me out a lot. I’m hoping to give one thing back
and help others like you helped me.

My site … https://mpc-install.com/punbb-1.4.6/viewtopic.php?id=689837

BTC Prestige Website

hey there and thank you for your info – I’ve certainly
picked up something new from right here. I did however expertise several technical points using this BTC Prestige Website,
as I experienced to reload the web site many times previous to I could get it to
load correctly. I had been wondering if your web hosting is OK?
Not that I’m complaining, but slow loading instances times will often affect your placement in google and could damage your high quality score
if ads and marketing with Adwords. Anyway I am
adding this RSS to my email and could look out for much more of your respective fascinating content.

Make sure you update this again very soon..

https://w123ce.ru/index.php?action=profile;u=45701

I seriously love your blog.. Very nice colors & theme.

Did you make this website yourself? Please reply back as I?m attempting
to create my own personal website and would like to know
where you got this from or what the theme is named. Many thanks!

Also visit my web site … https://w123ce.ru/index.php?action=profile;u=45701

MaxExtend Review

Some really superb posts on this web site, thanks for contribution.

My page – MaxExtend Review

Tfivgk

dapoxetine 60mg – generic viagra cialis where can i buy tadalafil

Szcnug

erectile dysfunction symptoms – fda approved over the counter ed pills the blue pill ed

Gaia's Choice CBD Reviews

I also think thence, perfectly indited post!

Here is my page; Gaia’s Choice CBD Reviews

Burst Audio Wireless Earbuds

Thank you for the blog post. Jones and I are already
saving for a new book on this subject matter and your article has made us all to save all of
our money. Your notions really responded to all our questions.
In fact, in excess of what we had acknowledged just before we came across your
excellent blog. We no longer have doubts
and a troubled mind because you have truly attended to our own needs in this post.
Thanks

my blog post … Burst Audio Wireless Earbuds

thaipurchase.com

Very good info. Lucky me I found your blog by accident (stumbleupon).
I’ve bookmarked it for later!

Here is my web-site thaipurchase.com

Kjxixb

generic prednisone online – where to buy prednisone online 120 mg prednisone

Blaux Classic Desktop AC Instructions

Hello there, just became aware of your blog through Google, and found that it is really
informative. I am gonna watch out for brussels. I will be grateful if
you continue this in future. Many people will be benefited from your writing.
Cheers!

my site; Blaux Classic Desktop AC Instructions

Keoni CBD Oil Reviews

Incredible! This blog looks exactly like my old one!
It’s on a entirely different subject but it has pretty much the
same layout and design. Excellent choice of colors!

Also visit my blog post: Keoni CBD Oil Reviews

Rupihm

provigil a stimulant – provigil schedule modafinil reddit

https://lysto-forum.tue-image.nl/index.php?action=profile;u=196602

Hi there! Quick question that’s totally off topic.
Do you know how to make your site mobile friendly?
My blog looks weird when viewing from my iphone4.
I’m trying to find a theme or plugin that might be able to resolve this issue.
If you have any recommendations, please share. Thanks!

Here is my website: https://lysto-forum.tue-image.nl/index.php?action=profile;u=196602

Gorges De Soleil Cream

Great post, I think blog owners should larn a lot from this site its real user
genial. So much superb info on here :D.

Also visit my webpage – Gorges De Soleil Cream

Naked CBD Gummies Reviews

Hmm is anyone else experiencing problems with the pictures on this blog
loading? I’m trying to figure out if its a problem on my end or if it’s the blog.
Any feedback would be greatly appreciated.

my webpage: Naked CBD Gummies Reviews

Irhqtn

where to get accutane prescription – accutane prescription nz buy brand name accutane online

Puyrve

over the counter amoxicillin kroger – buy amoxil online cvs amoxicillin price no insurance

Kyoang

vardenafil generic drug – buy levitra vardenafil prescriptions online

Awwbbx

ivermectin 6 mg tablets – where to buy ivermectin ivermectin lotion

Uvfgce

tadalafil soft tabs cheap – canadian pharmacy can you buy tadalafil online

Mplnye

cost of stromectol – stromectol 3mg online ivermectin 4000

Pure Optimum Keto

I really like your writing style, good information, thank you for posting :D.

Here is my blog post … Pure Optimum Keto

Ltvewe

accutane 40 mg online – accutane online canadian pharmacy order accutane from canada

Crgotc

lyrica tablets 150mg – lyrica 300 mg for sale canadian online pharmacy reviews

Atkziz

price of amoxicillin without insurance – antibiotics without a doctors prescription generic amoxicillin cost

Knsklp

viagra super force – viagra online no prescription generic viagra otc

http://www.invest74.ru/

I am glad for writing to make you be aware of what a remarkable experience
my daughter experienced browsing your webblog. She mastered plenty of issues, not to mention what
it is like to possess a very effective helping spirit to have a number of people without problems fully understand specified complex subject matter.
You undoubtedly exceeded her expected results. Thank you
for distributing these effective, trustworthy, edifying and also unique guidance on the topic to Jane.

Review my web-site – http://www.invest74.ru/

Cryogen Portable AC

Aw, this was a very good post. Taking the time
and actual effort to generate a really good article…
but what can I say… I procrastinate a lot and never
manage to get anything done.

Feel free to visit my web page Cryogen Portable AC

Nzjqvo

generic tadalafil 2018 – online cialis from india cialis 20 mg online

Paramore Cream

Right here is the right website for anybody who hopes to find out about
this topic. You realize so much its almost hard to argue with you (not that I personally will need to…HaHa).
You definitely put a brand new spin on a subject which has been discussed for
many years. Excellent stuff, just wonderful!

Look at my web-site – Paramore Cream

Uwibxr

prednisone 10 mg – prednisone 20 mg tablets coupon prednisone 20mg online pharmacy

Eweaay

modafinil and birth control – provigil provigil 100mg

Body Core Keto

Please let me know if you’re looking for a article author for your blog.
You have some really great posts and I feel
I would be a good asset. If you ever want to take some of the load off, I’d love to write some content for your blog in exchange for
a link back to mine. Please shoot me an e-mail if interested.
Thanks!

Review my blog post; Body Core Keto

wizardhardware.com

I every time spent my half an hour to read this website’s posts every day along with a cup of coffee.

Also visit my page Coastal Hemp CBD Review (wizardhardware.com)

Duwawc

zithromax 500 mg tablet – zithromax order online uk azithromycin z pack

Lrxsyd

buy cheap lasix – furosemide 40 mg pill generic lasix 20 mg

Re ViVium Reviews

Inspiring quest there. What occurred after? Good luck!

My web site :: Re ViVium Reviews

Vylhnw

generic clomid – clomid online clomiphene online 100mg

Vbntjk

viagra fast delivery – where to get generic viagra for women generic sildenafil us

Ctnirg

cheapest cialis 20mg online – cialis 20 mg tablet cheap 5 mg tadalafil

Paramore Cream Review

This post will help the internet viewers for building
up new website or even a weblog from start to end.

Feel free to surf to my blog post – Paramore Cream Review

Alpha Edge Male Enhancement Reviews

Greetings from Carolina! I’m bored to death at work so I decided
to check out your website on my iphone during lunch break.
I enjoy the info you provide here and can’t wait to take a look
when I get home. I’m shocked at how quick your blog loaded on my mobile ..
I’m not even using WIFI, just 3G .. Anyhow, fantastic site!

Feel free to surf to my page … Alpha Edge Male Enhancement Reviews

Wrdcqb

ivermectin 0.5 – can i buy ivermectin online ivermectin india

http://cadets.wycombeaircadets.org/smf/index.php?action=profile;u=9427

Aw, this was an exceptionally good post.
Taking the time and actual effort to create a great article?
but what can I say? I put things off a lot and never manage to get anything
done.

Stop by my webpage – http://cadets.wycombeaircadets.org/smf/index.php?action=profile;u=9427

Gpdrrn

wind creek casino online games – casino online slots empire casino online

Orlkhm

erectile dysfunction definition – ed pills gnc natural ed pills

Cuaqxq

prednisone price in india – prednisone 20 mg over the counter prednisone tabs

Uieuva

generic viagra rx – viagra without prescription canada viagra 1000mg price

Amellia Skin Care Review

I like this site because so much utile material on here
:D.

Feel free to visit my site – Amellia Skin Care Review

Burolc

cialis 20 mg online pharmacy – advcialisp.com can i purchase cialis over the counter

Bncrqr

ivermectin lotion 0.5 – price of stromectol tablets stromectol price usa

Kcpqua

erectile dysfunction natural treatment – errectile disfunction brenda 35 ed contraceptive pill

https://rucame.club/

Stunning quest there. What occurred after?
Good luck!

Review my blog post :: https://rucame.club/

Gmtvmt

ventolin generic – generic ventolin price ventolin generic price

Renown CBD Gummies Review

Wow! Thank you! I continually needed to write on my site something like that.

Can I take a portion of your post to my blog?

My website :: Renown CBD Gummies Review

Cmkpxj

order cytotec online usa – cytotec online india buy cytotec 200 mg online

Qibsjt

buy doxycycline india – doxycycline prices price of doxycycline in india

Glacier Air Conditioner

Hi there, You have done an incredible job.
I will definitely digg it and in my view recommend to my friends.

I’m confident they will be benefited from this website.

My blog – Glacier Air Conditioner

Qkkmfk

neurontin cost uk – neurontin 900 buy synthroid australia

web hosting are

Do you have a spam issue on this site; I also am a
blogger, and I was curious about your situation; we have
developed some nice procedures and we are looking to trade strategies with
other folks, be sure to shoot me an e-mail
if interested.

Ubazjw

sildenafil generic canada – generic viagra online

why web hosting

I’m not sure exactly why but this website is loading incredibly slow
for me. Is anyone else having this problem or is it a problem on my end?
I’ll check back later on and see if the problem still exists.

web hosting is

Hi, I wish for to subscribe for this blog to obtain latest updates, therefore where can i do it please assist.

Viagra

Get Tadalifil

Pzeblu

buy cialis 20mg – order tadalafil online canada generic tadalafil from canada

http://bitly.com/

Post writing is also a excitement, if you know then you can write otherwise it
is complex to write.

bitly.com

If some one needs to be updated with newest technologies
after that he must be visit this web site and be up to date every day.

propecia shedding

Amoxicillin 500mg Cap

and quest bars

Thank you for sharing your info. I truly appreciate your efforts and I will be waiting for your further
write ups thanks once again.

http://bit.ly/38vuS56

Hello all, here every person is sharing these familiarity, so it’s
fastidious to read this website, and I used to visit this website
everyday.

Iufvni

over the counter prednisone no prescription – deltasone 5 mg where to buy prednisone 5443 without prescription

http://bitly.com/

Excellent site. Plenty of helpful info here. I’m sending it to some pals
ans additionally sharing in delicious. And of course,
thanks for your effort!

SEO

Wow, awesome blog layout! How long have you ever been running a blog for? you made running a blog glance easy. The entire glance of your website is magnificent, as smartly as the content material!

asmr there

Greetings! Very helpful advice in this particular article!
It is the little changes that produce the largest changes.
Many thanks for sharing!

scoliosis surgery where

My brother recommended I might like this web site. He was totally right.
This post actually made my day. You cann’t imagine simply how much time I
had spent for this info! Thanks!

asmr your

Spot on with this write-up, I seriously think
this web site needs far more attention. I’ll probably be returning to read through more, thanks for the advice!

http://j.mp/

Simply wish to say your article is as astounding. The clarity in your post is
simply cool and i could assume you are an expert on this subject.
Fine with your permission allow me to grab your RSS feed to keep
up to date with forthcoming post. Thanks a million and please continue
the enjoyable work.

http://tinyurl.com

Howdy this is kinda of off topic but I was wanting to
know if blogs use WYSIWYG editors or if you have to manually code with HTML.

I’m starting a blog soon but have no coding expertise so I
wanted to get advice from someone with experience.
Any help would be greatly appreciated!

asmr what

Ahaa, its fastidious dialogue concerning this article at this place at this
weblog, I have read all that, so at this time me also commenting at this place.

for asmr

Hello! I know this is kind of off topic but I was wondering if you knew where I could get a
captcha plugin for my comment form? I’m using the same blog platform as yours and I’m having difficulty finding
one? Thanks a lot!

Frdhqj

accutane prescription coupon – buy accutane online uk accutane pharmacy

http://www.anapapansion.ru/

Heya i’m for the first time here. I came across this board and I find It really useful & it helped me out a lot.
I hope to give something back and help others like you aided me.

My website – http://www.anapapansion.ru/

http://bit.ly/

Thanks for ones marvelous posting! I truly enjoyed reading
it, you can be a great author.I will ensure that I bookmark your blog and
may come back at some point. I want to encourage you to definitely continue your great writing, have a nice day!

asmr that

Hey there! I know this is somewhat off topic but I was wondering which blog platform are you using for this
website? I’m getting tired of WordPress because I’ve had issues with hackers
and I’m looking at alternatives for another platform.
I would be fantastic if you could point me in the direction of a good
platform.

j.mp

Hello There. I discovered your blog the use of msn.
This is an extremely neatly written article.
I will be sure to bookmark it and come back to learn more of your
useful info. Thank you for the post. I’ll definitely return.

there asmr

Its like you read my mind! You seem to know a lot about this,
like you wrote the book in it or something. I think that you can do
with some pics to drive the message home a little bit, but
instead of that, this is excellent blog. A great read.

I will definitely be back.

was scoliosis surgery

An impressive share! I have just forwarded this onto a colleague
who had been doing a little homework on this.
And he actually bought me breakfast simply because I stumbled upon it for
him… lol. So let me reword this…. Thanks for the
meal!! But yeah, thanx for spending the time to discuss this topic
here on your internet site.

Health Flow Male Enhancement Ingredients

I know this if off topic but I’m looking into starting my own weblog and was wondering what all is required
to get setup? I’m assuming having a blog like yours would cost a
pretty penny? I’m not very web smart so I’m not 100% certain.
Any tips or advice would be greatly appreciated. Thanks

Also visit my web-site :: Health Flow Male Enhancement Ingredients

for quest bars

Hello, I think your site might be having browser
compatibility issues. When I look at your blog site in Ie, it looks
fine but when opening in Internet Explorer, it has some
overlapping. I just wanted to give you a quick
heads up! Other then that, wonderful blog!
quest bars http://j.mp/3jZgEA2 quest bars

smartcalltaxi.kr

Hello there, just became alert to your blog through Google, and found that it’s really informative.
I am gonna watch out for brussels. I will be grateful if you continue this in future.

Lots of people will be benefited from your writing. Cheers!

Here is my webpage; smartcalltaxi.kr

app.gumroad.com

Excellent blog here! Also your site loads up fast!
What web host are you using? Can I get your
affiliate link to your host? I wish my site loaded
up as fast as yours lol asmr https://app.gumroad.com/asmr2021/p/best-asmr-online asmr

coub.com

At this time it sounds like WordPress is the
best blogging platform available right now. (from what I’ve read) Is that what you are using
on your blog? scoliosis surgery https://coub.com/stories/962966-scoliosis-surgery scoliosis surgery

j.mp

Just wish to say your article is as amazing.
The clarity in your post is simply spectacular and i could assume you are an expert on this subject.
Fine with your permission let me to grab your feed to keep up to date with forthcoming post.
Thanks a million and please carry on the enjoyable work.
scoliosis surgery https://0401mm.tumblr.com/ scoliosis
surgery

Hlxrax

ivermectin 6mg – ivermectin for human stromectol pill

https://jpgsoft.co.kr

Hi there very cool blog!! Man .. Excellent ..
Wonderful .. I will bookmark your site and take the feeds also…I am
happy to find so many useful information here within the post,
we want develop extra techniques on this regard, thanks for sharing.

Also visit my web blog https://jpgsoft.co.kr

j.mp

This is very interesting, You are a very skilled blogger.

I have joined your rss feed and look forward to seeking more of your magnificent post.

Also, I have shared your website in my social networks!
cheap flights http://1704milesapart.tumblr.com/ cheap flights

http://tinyurl.com

Great blog! Do you have any tips and hints for aspiring writers?
I’m planning to start my own site soon but I’m a little lost on everything.
Would you propose starting with a free platform
like WordPress or go for a paid option? There
are so many options out there that I’m completely overwhelmed ..
Any ideas? Kudos! ps4 https://j.mp/3z5HwTp ps4

Qhvhvf

prednisone 2.5 mg price – prednisone 50 mg generic prednisone 5mg online

http://www.iherb.com/search?kw=questbars

Right now it looks like BlogEngine is the preferred blogging platform available right now.
(from what I’ve read) Is that what you’re
using on your blog? quest bars https://www.iherb.com/search?kw=quest%20bars quest bars

check here

I read this paragraph fully concerning the difference of most up-to-date and earlier technologies, it’s awesome article.

Ultra Quick Keto Review

I just wanted to jot down a brief word to be able to say thanks to
you for the great solutions you are posting here.

My incredibly long internet search has at the end been compensated with
pleasant suggestions to write about with my relatives. I would repeat that many of us website visitors are extremely blessed
to live in a fantastic site with many perfect people with insightful concepts.
I feel really fortunate to have encountered the web site and look forward to some more fun moments reading here.

Thank you once more for a lot of things.

Feel free to visit my web site – Ultra Quick Keto Review

Lasix

Achat Viagra Canada

Leif

Right here is the right web site for anybody who
really wants to understand this topic. You realize a whole
lot its almost hard to argue with you (not that I personally will need to?HaHa).
You definitely put a fresh spin on a subject that
has been discussed for ages. Great stuff, just wonderful!

Have a look at my blog; Leif

where can i buy plaquenil in tucson az

Amoxil 500mg $0.29 Unit Price

Zithromax

Cialis 5 Mg Daily Success

Eybadv

doxycycline medication cost – 90 mg prednisolone cheap prednisolone uk

Tenteetom

http://buylasixshop.com/ – furosemide 40mg tablet

Jmodbp

ivermectin 0.1 – ivermectin pills ivermectin 6 mg

Iuryya

cost of ivermectin pill – ivermectin 4000 stromectol 3mg cost

Qjooyu

sildenafil online prescription free – sildepl.com cheap sildenafil

Kcrrwu

tadalafil 20 mg – canadian online pharmacy tadalafil tadalafil buy online

Leave a Reply

Your email address will not be published.