Reckless Spending Seen in Chinese Stocks, House Prices, Diamond Skull

A number of analysts whom we admire and respect – Jeremy Grantham and Richard Russell, for example – have come to believe that we are on the threshold of an even greater bull market.

We have noticed how one bubble has led to another…in stocks…in real estate…in art…in watches and collectibles…in one market…then in another…until the whole financial world is expanding at an alarming rate. We read in the paper just yesterday that the celebrated art promoter Damien Hirst has created a diamond-encrusted skull now apparently offered for sale at US$100 million. Pity the poor dope who buys it! But what do we know? It will probably go up! And now you can buy stocks in China for 40 times earnings…and houses priced over US$100 million too.

We have noticed also how reckless spending, borrowing and money printing in the United States now leads to reckless investing, borrowing and money printing in other countries, as each central bank tries to keep its own currency from going down faster than the dollar…and how the financial industry has invented new ways to increase liquidity and leverage, effectively reducing central bankers’ control over the marketplace.

And now it seems that the whole world is enjoying a Super Bubble…unlike anything ever seen before. It really is a New Era, in other words. How big will it get? How long will it last? We wish we could tell you…

Everyday is a new day…and every day is just like the one before. Every market is completely new…and not so different from ones that came before. Every generation prepares the way for the next one.

Bill Bonner
Markets and Money

Bill Bonner

Bill Bonner

Since founding Agora Inc. in 1979, Bill Bonner has found success and garnered camaraderie in numerous communities and industries. A man of many talents, his entrepreneurial savvy, unique writings, philanthropic undertakings, and preservationist activities have all been recognized and awarded by some of America’s most respected authorities. Along with Addison Wiggin, his friend and colleague, Bill has written two New York Times best-selling books, Financial Reckoning Day and Empire of Debt. Both works have been critically acclaimed internationally. With political journalist Lila Rajiva, he wrote his third New York Times best-selling book, Mobs, Messiahs and Markets, which offers concrete advice on how to avoid the public spectacle of modern finance. Since 1999, Bill has been a daily contributor and the driving force behind Markets and Money.

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