David Stockman warns that the global economy has reached an “epoch-making reversal,” the moment when the false prosperity created from trillions of dollars of printed money by the world's central banks is taking a sharp turn in the opposite direction.
Few understand the global economy and its governance better than David Stockman - former OMB director under President Reagan, former US ambassador, author of the bestselling Great Deformation and a veteran financier - which is why his views should be listened to and not taken lightly. He is well aware of how our political and financial systems work and their vulnerabilities.
And Stockman thinks that the top of the current era of asset price bubble has reached its peak, he thinks that it reached its peak in January 2018. As this “Massive Bubble” prepares to burst, Stockman estimates that the risk of an economic crisis is as great, if not greater, than the Great Financial Crisis of 2008, due to the radical and unsustainable expansion of monetary policy that central banks have pursued over the past decades.
This has driven up the prices of stocks, bonds, real estate and most other assets at rates that have no basis for the current cash flows of the global economy. In short, they are wildly overpriced.
A key condition that Stockman expected to see, signaling that the bubble was about to burst, is the concentration of speculative capital in fewer stocks as “good” options for investors dwindle. Now we can clearly see this in the FAANG complex (a topic discussed in detail in our recent report The FAANG-nary In The Coal Mine)
Stockman's main warning is that there is no bet under this market - that when perception shifts from greed to fear, the bottom is much deeper than most investors realize. According to him, it is "rigged for implosion."
He predicts that the Great Reboot is imminent. Anyone who sees this and urgently takes sensible action today will have huge investment opportunities once the dust settles. Perhaps for them this will be the chance that is given once in a lifetime.
To hear Stockman's specific predictions and warnings, listen to this 16-minute interview:
Promotional video:
Those interested in spending a full day with David Shtokman, where he will present the specifics of his predictions as well as targeted Q&A questions, should consider attending the Peak Prosperity Summit in New York on September 26, 2018.
This summit is very timely. Most likely, we do not have much time left before the Great Reboot predicted by Shtokman starts.
As he put it himself: