Irrational Exuberance in Our Markets
By Mitchell Anthony
November 23, 2021
Alan Greenspan’s infamous speech in 1996 hit the nail on the head when he warned the world about the irrational exuberance that existed in both the US economy and US financial markets. For the most part corporate leaders and investors failed to take heed of the notice until it was too late. The exuberance centered heavily on greedy blind ambition as well as ignorance that drove capital into Internet and tech oriented businesses that had far too optimistic visions for their products and product cycles. Some had no products or services at all that were rational. The exuberance caused these businesses to invest heavily in human capital that they had to divest quickly thereof when the bottom fell out at the end of that dot-com cycle in 2000. The fallout from the tech sector dominoed into other sectors and caused a classic economic bust that led to one of the worst equity market declines on record. Similarly the economic strength from 2002-2007 that preceded the great recession of 2009, saw greedy blind ambition drive over-consumption in the housing market into a state of irrational exuberance that resulted in a massive economic bust that took a decade to put behind us.
Equity Markets and Real Estate Assets have surged dramatically over the past two years, with everything from cryptocurrency to meme stocks exploding in value, causing investors to wonder about the existence of rot in our economy? Could we be on the verge of another bust for the economy and the markets?Read more
Lingering Headwinds from Covid
By Mitchell Anthony
November 3, 2021
Covid 19 has affected the lives of almost everyone on the globe for the last few years. Thousands of lives have been lost and the personal agendas of everyone on the planet have been altered. Global economies have been wrecked as businesses have had to stop and start because of the pandemic. Most mature businesses and industries survived and some have been big winners while others have been losers. As we start to see the light at the end of the tunnel we seek to understand what the lingering economic effects from Covid 19 will be for years to come. How will consumption be altered and how will production of goods and services be changed. What industries and businesses have found tailwinds from this pandemic that will linger and enhance their outlook for years to come. Conversely what businesses and industries have headwinds that are lingering and dampening their growth prospects.Read more
