Investing.com - Financial Markets Worldwide
Join +750K new investors every month who copy stock picks from billionaire's portfoliosSign Up Free

Top-Five Reasons You Know Another Bubble Is Forming

ByNicholas Santiago
Published 05/06/2013, 02:55 PM
Updated 07/09/2023, 06:31 AM
IBM
-
BIG
-
CCF
-
DRP
-

Almost every day, the U.S. markets hit new, all-time highs. With rampant unemployment, low jobs growth and an ugly global economy, many are wondering if we are in the midst of a new stock-market bubble.

What follows is a list of our top-five reasons why you know another stock-market bubble is forming.

5. Earnings have been poor at best with many large Fortune 500 companies like International Business Machines Corp. (IBM) missing horrible. The market continues to make new all-time highs.

4. Volume is almost non existent on every move up. Today, we have done 34 million on the SPDR S&P 500 ETF Trust (SPY). This tells us institutions are far from being buyers.

3. Mutual fund inflows have surged dramatically 2013. This tells us the little, average investor is finally feeling safe enough to buy into the market again. As we all know, when all the average investors pile in, the end is near and a big drop is just ahead.

2. The Federal Reserve has printed close to $4 trillion Dollars out of thin air in the last few years. The Federal Reserve has also created every bubble in recent history. Printing this much money keeps yields artificially low. Keeping yields at record lows forces money to chase better returns. Thus money rushes into stocks creating a bubble.

1. Mila Kunis and other celebrities have endorsed stocks and started investing. If you ever needed a bubble signal in the markets, that's it.

While these reasons all ring true, the key will be discovering where the top of this bubble is...so tune in to the charts and they'll show us. A bloodbath is sure to follow.
SPDR S&P 500 ETF
Gareth Soloway
Chief Market Strategist
www.InTheMoneyStocks.com

Latest comments

Loading next article…
Install Our App
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.