What is this “bubble of bubbles” burst of the US Stock Markets being predicted?
Harry Dent has predicted a massive stock market crash in the US next year. He stated that the markets could see some corrections resulting in a crash which will be worse than what the investors saw during the sub-prime crisis in 2008. He further stated that this will not result in an economic recession but will be worse in the form of depression in the economy. He made these comments during an interview given to Fox Business Network. Previously, the economist had been predicting this sort of doomsday scenarios for many years. Presently, after the COVID-19 pandemic, the US has been recovering with a slow and steady GDP growth and an increase in the number of jobs that have been created.
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Reasons:
Harry Dent who is an alumnus of the Harvard Business School has said that the stock prices are presently experiencing a sort of “bubble of bubbles” which has been aided by a loose monetary and fiscal policy followed by the US. He stated the market which is presently reflecting inflated value of stocks will tend to correct itself to its correct value.
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The market has also been flooded with various stimulus packages since the sub-prime crisis of 2008. The total stimulus amount has been estimated to be $27 trillion.
In economics when a loose monetary
