Does every major asset seem expensive to you right now? Does it seem overpriced?
Well, what if it is, where do we end up?
The NY Times has an article titled How The Everything Boom might end: The Good, Bad and the ugly.
Basically it breaks down into (1) the good: Low price of capital unleashes productivity, economy grows into current valuations. (2) The bad: Japan style stagnation 15 years of low rates and low returns or (3) the ugly: spike in prices with a depressed economy.
But the pattern of the last few years shows that the “bad” scenario has been closest to the reality. That doesn’t mean the rest of the bad script will continue in the years ahead, but it should prompt those predicting the first or third outcome to wrestle with why they have been wrong so far.
So what do you think? Whats the future look like from your view point and would it have been any easier to predict the future in the past?