{"id":33298,"date":"2020-10-25T10:52:28","date_gmt":"2020-10-25T14:52:28","guid":{"rendered":"http:\/\/stateofthenation.co\/?p=33298"},"modified":"2020-10-25T10:52:42","modified_gmt":"2020-10-25T14:52:42","slug":"no-matter-who-wins-they-will-be-facing-the-mother-of-all-stock-market-bubbles","status":"publish","type":"post","link":"http:\/\/stateofthenation.co\/?p=33298","title":{"rendered":"No matter who wins, they will be facing &#8220;The Mother of All Stock Market Bubbles&#8221;"},"content":{"rendered":"<h1><strong>The Mother Of All Stock Market Bubbles<\/strong><\/h1>\n<p><!--more-->by Stephen Lendman<\/p>\n<p><strong>Never before\u00a0<\/strong>in US equity market history was there\u00a0<strong>as great a disconnect between economic reality and equity prices<\/strong>\u00a0as now&#8230;<\/p>\n<p><a href=\"https:\/\/www.zerohedge.com\/s3\/files\/inline-images\/download%20%2811%29_8.jpg?itok=kDoKlTb2\" data-image-external-href=\"\" data-image-href=\"\/s3\/files\/inline-images\/download%20%2811%29_8.jpg?itok=kDoKlTb2\" data-link-option=\"0\"><picture><source srcset=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_desktop\/public\/inline-images\/download%20%2811%29_8.jpg?itok=XYaDkdaR 1x\" type=\"image\/jpeg\" media=\"all and (min-width: 1280px)\" \/><source srcset=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_desktop\/public\/inline-images\/download%20%2811%29_8.jpg?itok=XYaDkdaR 1x\" type=\"image\/jpeg\" media=\"all and (min-width: 480px)\" \/><source srcset=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_desktop\/public\/inline-images\/download%20%2811%29_8.jpg?itok=XYaDkdaR 1x, https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_desktop\/public\/inline-images\/download%20%2811%29_8.jpg?itok=XYaDkdaR 2x\" type=\"image\/jpeg\" media=\"all and (min-width: 1024px)\" \/><source srcset=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_desktop\/public\/inline-images\/download%20%2811%29_8.jpg?itok=XYaDkdaR 1x\" type=\"image\/jpeg\" media=\"all and (min-width: 768px)\" \/><source srcset=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_mobile\/public\/inline-images\/download%20%2811%29_8.jpg?itok=kDoKlTb2 1x\" type=\"image\/jpeg\" \/><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/inline-images\/download%20%2811%29_8.jpg\" alt=\"\" width=\"500\" height=\"278\" data-entity-type=\"file\" data-entity-uuid=\"696b6157-72b9-4b80-b7d6-4168bb954ced\" data-responsive-image-style=\"inline_images\" \/><\/picture><\/a><\/p>\n<p>At a time of economic collapse and likely protracted US Depression, market valuations are at or near all-time highs.<\/p>\n<div class=\"ad__wrapper-element\"><\/div>\n<p><a href=\"https:\/\/www.zerohedge.com\/s3\/files\/inline-images\/Market-vs-GDP-Disconnect_0.png?itok=NO5QJOIs\" data-image-external-href=\"\" data-image-href=\"\/s3\/files\/inline-images\/Market-vs-GDP-Disconnect_0.png?itok=NO5QJOIs\" data-link-option=\"0\"><picture><source srcset=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_desktop\/public\/inline-images\/Market-vs-GDP-Disconnect_0.png?itok=DipjJC8Y 1x\" type=\"image\/png\" media=\"all and (min-width: 1280px)\" \/><source srcset=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_desktop\/public\/inline-images\/Market-vs-GDP-Disconnect_0.png?itok=DipjJC8Y 1x\" type=\"image\/png\" media=\"all and (min-width: 480px)\" \/><source srcset=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_desktop\/public\/inline-images\/Market-vs-GDP-Disconnect_0.png?itok=DipjJC8Y 1x, https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_desktop\/public\/inline-images\/Market-vs-GDP-Disconnect_0.png?itok=DipjJC8Y 2x\" type=\"image\/png\" media=\"all and (min-width: 1024px)\" \/><source srcset=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_desktop\/public\/inline-images\/Market-vs-GDP-Disconnect_0.png?itok=DipjJC8Y 1x\" type=\"image\/png\" media=\"all and (min-width: 768px)\" \/><source srcset=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_mobile\/public\/inline-images\/Market-vs-GDP-Disconnect_0.png?itok=NO5QJOIs 1x\" type=\"image\/png\" \/><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/inline-images\/Market-vs-GDP-Disconnect_0.png\" alt=\"\" width=\"500\" height=\"327\" data-entity-type=\"file\" data-entity-uuid=\"dcdf53ca-c6bd-4eb1-a40b-99df7332a751\" data-responsive-image-style=\"inline_images\" \/><\/picture><\/a><\/p>\n<p>David Stockman explained some of the\u00a0<strong>extremes\u00a0<\/strong>in a period he called\u00a0<em><strong>\u201coutright fiscal insanity.\u201d<\/strong><\/em><\/p>\n<p>Count the ways:<\/p>\n<ul>\n<li>Amazon, a company that didn\u2019t exist pre-1994 is \u201c43% of the S&amp;P 500 consumer discretionary index.\u201d<\/li>\n<li>\u201cNearly two-thirds of the market is underperforming so far this year.\u201d<\/li>\n<li>\u201cYear-to-date, only one in three stocks is actually in the green.\u201d<\/li>\n<li>\u201cOne in five stocks is down 50% or more from its all-time high.\u201d<\/li>\n<li>\u201cThe five largest stocks in the S&amp;P 500 have a combined market cap that equals that of the \u2018smallest\u2019 389 stocks.\u201d<\/li>\n<li>\u201cApple, Amazon, Microsoft, and Google\u2014four companies\u2014have a combined market cap (over $6 trillion) that is greater than the GDP of every country in the world, minus the US and China.\u201d<\/li>\n<li>\u201cTesla, having surpassed Walmart (with one-twentieth of the revenue!), has become the ninth-largest stock in the US.\u201d<\/li>\n<\/ul>\n<p><strong>All of the above give new meaning to the term surreal.<\/strong><\/p>\n<p>If a Hollywood script writer presented the above scenario to a producer for filming, it would either be accepted as science fiction or rejected outright as too unrealistic.\u00a0<strong>Who\u2019d believe it?<\/strong><\/p>\n<div class=\"ad__wrapper-element\"><\/div>\n<p>Under these conditions,\u00a0<strong>it\u2019s impossible to invest wisely<\/strong>\u00a0because markets are dominated by speculative excess \u2014 riverboat gambling replacing what sound investing used to be.<\/p>\n<p><strong>No matter which wing of the US one-party state wins control of the White House and\/or Congress, nothing will change \u2014 things more likely to worsen until an inevitable day of reckoning arrives.<\/strong><\/p>\n<p><strong><a href=\"https:\/\/www.zerohedge.com\/s3\/files\/inline-images\/download%20%2810%29_6.jpg?itok=O2pi0Y9g\" data-image-external-href=\"\" data-image-href=\"\/s3\/files\/inline-images\/download%20%2810%29_6.jpg?itok=O2pi0Y9g\" data-link-option=\"0\"><picture><source srcset=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_desktop\/public\/inline-images\/download%20%2810%29_6.jpg?itok=UpLAZyp8 1x\" type=\"image\/jpeg\" media=\"all and (min-width: 1280px)\" \/><source srcset=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_desktop\/public\/inline-images\/download%20%2810%29_6.jpg?itok=UpLAZyp8 1x\" type=\"image\/jpeg\" media=\"all and (min-width: 480px)\" \/><source srcset=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_desktop\/public\/inline-images\/download%20%2810%29_6.jpg?itok=UpLAZyp8 1x, https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_desktop\/public\/inline-images\/download%20%2810%29_6.jpg?itok=UpLAZyp8 2x\" type=\"image\/jpeg\" media=\"all and (min-width: 1024px)\" \/><source srcset=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_desktop\/public\/inline-images\/download%20%2810%29_6.jpg?itok=UpLAZyp8 1x\" type=\"image\/jpeg\" media=\"all and (min-width: 768px)\" \/><source srcset=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_mobile\/public\/inline-images\/download%20%2810%29_6.jpg?itok=O2pi0Y9g 1x\" type=\"image\/jpeg\" \/><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/inline-images\/download%20%2810%29_6.jpg\" alt=\"\" width=\"500\" height=\"329\" data-entity-type=\"file\" data-entity-uuid=\"5b0add3f-77f4-4ca2-a719-7ab7730260b4\" data-responsive-image-style=\"inline_images\" \/><\/picture><\/a><\/strong><\/p>\n<p>Stockman asked:<\/p>\n<blockquote><p>\u201cHow could the S&amp;P 500 be trading at its highest multiple in 70 years when the growth rate of corporate earnings has been sinking for more than two decades?\u201d<\/p>\n<p>\u201cThe recent S&amp;P index value implies a PE multiple of 36.8X\u2014a place the S&amp;P 500 has never been before.\u201d<\/p>\n<p><strong>\u201cThe forward PE is now above the record high reached during the dot-com madness at the\u201d end of the 1990s.<\/strong><\/p>\n<p><strong><a href=\"https:\/\/www.zerohedge.com\/s3\/files\/inline-images\/graph9.9-1024x545.jpg?itok=1A2Y7iLS\" data-image-external-href=\"\" data-image-href=\"\/s3\/files\/inline-images\/graph9.9-1024x545.jpg?itok=1A2Y7iLS\" data-link-option=\"0\"><picture><source srcset=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_desktop\/public\/inline-images\/graph9.9-1024x545.jpg?itok=EPG5OU7L 1x\" type=\"image\/jpeg\" media=\"all and (min-width: 1280px)\" \/><source srcset=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_desktop\/public\/inline-images\/graph9.9-1024x545.jpg?itok=EPG5OU7L 1x\" type=\"image\/jpeg\" media=\"all and (min-width: 480px)\" \/><source srcset=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_desktop\/public\/inline-images\/graph9.9-1024x545.jpg?itok=EPG5OU7L 1x, https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_desktop\/public\/inline-images\/graph9.9-1024x545.jpg?itok=EPG5OU7L 2x\" type=\"image\/jpeg\" media=\"all and (min-width: 1024px)\" \/><source srcset=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_desktop\/public\/inline-images\/graph9.9-1024x545.jpg?itok=EPG5OU7L 1x\" type=\"image\/jpeg\" media=\"all and (min-width: 768px)\" \/><source srcset=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/styles\/inline_image_mobile\/public\/inline-images\/graph9.9-1024x545.jpg?itok=1A2Y7iLS 1x\" type=\"image\/jpeg\" \/><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com\/s3fs-public\/inline-images\/graph9.9-1024x545.jpg\" alt=\"\" width=\"500\" height=\"266\" data-entity-type=\"file\" data-entity-uuid=\"7a3f8886-1d18-43a5-860b-1537f9d793e0\" data-responsive-image-style=\"inline_images\" \/><\/picture><\/a><\/strong><\/p>\n<p>In calendar year 2020, corporate earnings crashed. They\u2019re \u201c23% (below) their 2019 peak.\u201d<\/p><\/blockquote>\n<p><strong>Yet market valuations are at levels that suggest double-digit earnings growth ahead\u00a0<\/strong>\u2014 despite evidence indicating protracted economic Depression, mass unemployment, along with reduced business and consumer spending.<\/p>\n<p><strong>In today\u2019s world gone mad, what was unimaginable during my long ago boyhood, adolescence and youth is happening in real time.<\/strong><\/p>\n<p>___<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Mother Of All Stock Market Bubbles<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-33298","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"_links":{"self":[{"href":"http:\/\/stateofthenation.co\/index.php?rest_route=\/wp\/v2\/posts\/33298","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/stateofthenation.co\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/stateofthenation.co\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/stateofthenation.co\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/stateofthenation.co\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=33298"}],"version-history":[{"count":0,"href":"http:\/\/stateofthenation.co\/index.php?rest_route=\/wp\/v2\/posts\/33298\/revisions"}],"wp:attachment":[{"href":"http:\/\/stateofthenation.co\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=33298"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/stateofthenation.co\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=33298"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/stateofthenation.co\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=33298"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}