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What Is A Bubble And Are We In One? Goldman Answers
What is a "bubble" and are we in one?
Those two questions are a perennial obsession for market participants and especially for the financial media. There's always a bubble somewhere according to someone.
But in 2021, the bubble calls are even more prevalent than usual for a laundry list of reasons, not least of which are readily observable manifestations of what looks like outright delirium, whether it's Bitcoin at $60,000 or GameStop at $200.
Add to that stretched multiples, industry "legend
Some things — TSLA at $800+ — clearly were at bubble valuations, but the fact that the market as a whole is not bubblecious doesn’t mean that many stocks aren’t overvalued. Especially if rates keep rising.
I generally agree with Goldman’s conclusion, but then I look at SPACs and wonder who the hell is buying this garbage?
Re: typical of a “hope” phase of a bull-market run after an economic slump.
Yup, what we’re seeing is the typical reaction to a once in a hundred year pandemic — no big deal, nothing is different and this is just part of the normal growth trend that was in-place. Please continue to support Goldman and our analysts.
The markets can remain irrational longer than you can remain solvent.
– Keynes