Why It's Different This Time (Famous Last Words)
I'm not here to argue one way or another about what direction the stock market is going. All the experts are saying its going to keep climbing for a long time, so they're probably right.
People on the "inside" are absolutely certain that new all time highs are coming continually from now until eternity. Actually I'm starting to hear that sentiment quite literally everywhere, and that is usually a warning sign for a multitude of reasons. This book cover (no affiliation) illustrates just how silly people get when market mania is in season.
Every single time a market bull run hits the top, the sentiment is always the same about where the prices are going, and each time there is some underlying reason why the market simply cannot go down this time, and yet reasons be damned the whole thing crashes down anyway.
What I've been hearing everywhere lately is that we've had a couple years of sideways action in the stock market, and it should be climbing and roaring into a new bull market shortly because that sideways action was apparently the bear market that we didn't know we were in.
Okay, that's one of the crazier rationalizations I've heard in recent days, but even the more skeptical voices are still calling for a runaway bull market. I've never seen the entire investment world so certain of anything in my life.
Just think about that for a moment; is it rational for anyone to be 100% certain about a trend? I don't think so, yet there are a lot of established voices all saying that the markets have nowhere to go but up because the Fed has promised liquidity to the markets for as long as they want it.
There is however a possible fork in the road coming up very soon, and either the bulls or the bears are going to be in for a surprise, I believe. Call it a hunch, or call it intuition. All I know, there are way too many maniacally bullish voices out there right now saying that perpetual growth is locked in and the upward trend is guaranteed. To me it sounds more like a fleecing is coming.
Thanks for stopping in.