- Most developed world economies can’t continue to grow without financial engineering.
- However, inflation forced tightening will eventually have a significant impact on credit.
- This will only lead to more accommodation and toward an eventual crash, so be prepared.
Each significant historical bear market has an initial trigger. Weak home and car sales killed the 2003 – 2007 bull market, while the realization that stock valuations had gone too far initiated the bear market in March 2000.
But what will trigger the next bear market? Well, there’s a great possibility that it will be monetary tightening. Perhaps it won’t be the latest quarter percentage point rate increase, but it will probably be one of the next rate hikes. More →