{"id":53340,"date":"2020-05-17T07:57:36","date_gmt":"2020-05-17T12:57:36","guid":{"rendered":"https:\/\/olduvai.ca\/?p=53340"},"modified":"2020-05-17T07:57:41","modified_gmt":"2020-05-17T12:57:41","slug":"overpriced-stocks-may-be-bubble-ready-to-pop","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=53340","title":{"rendered":"Overpriced Stocks May Be Bubble Ready to Pop"},"content":{"rendered":"\n

Overpriced Stocks May Be Bubble Ready to Pop<\/a><\/h3>\n\n\n\n
\"overpriced<\/figure>\n\n\n\n

Even if local and state governments hadn\u2019t shut down businesses in attempts to mitigate the coronavirus, the U.S. economy was still set up to take on a number<\/a> of<\/a> economic<\/a> challenges<\/a>.<\/p>\n\n\n\n

But now, there\u2019s one additional challenge being considered<\/a> by billionaire David Tepper: over-inflated stock prices:<\/p>\n\n\n\n

Billionaire hedge fund investor David Tepper told CNBC on Wednesday the stock market is one of the most overpriced he\u2019s ever seen, only behind 1999. His comments sent stocks to a session low\u2026 He also said some Big Tech stocks like Amazon, Facebook and Alphabet may be \u201cfully valued.\u201d<\/p><\/blockquote>\n\n\n\n

If we take Mr. Tepper\u2019s concern at face value, the U.S. could be on the verge of another major stock bubble explosion.<\/p>\n\n\n\n

He did add that he thought stocks were even more overvalued in 1999, but of course time will tell if that ends up being true.<\/p>\n\n\n\n

Tepper also had words of warning<\/a> on the Fed\u2019s recent infusion of liquidity into the markets, saying, \u201cThe market is pretty high and the Fed has put a lot of money in here\u2026 There\u2019s been different misallocation of capital in the markets\u2026 The market is by anybody\u2019s standard pretty full.\u201d<\/p>\n\n\n\n

If the market is \u201cpretty full,\u201d then good fundamentals can\u2019t be in play. Another CNBC piece<\/a> reinforced this observation by comparing 30 million unemployment claims<\/a> to the still-rallying stock market:<\/p>\n\n\n\n

Stocks, though, are rallying in the face of historically awful economic numbers, in a bet on higher profit margins and an aggressive recovery that seems increasingly risky.<\/p><\/blockquote>\n\n\n\n

At some point, profits and other business fundamentals have to justify a company\u2019s stock price. Media hype alone can\u2019t cut it for the long term.<\/p>\n\n\n\n

This chart from the same CNBC article further reinforces the idea that fundamentals are not yet factored into stock prices:<\/p>\n\n\n\n

\u2026click on the above link to read the rest of the article\u2026<\/p>\n","protected":false},"excerpt":{"rendered":"

Overpriced Stocks May Be Bubble Ready to Pop Even if local and state governments hadn\u2019t shut down businesses in attempts to mitigate the coronavirus, the U.S. economy was still set up to take on a number of economic challenges. But now, there\u2019s one additional challenge being considered by billionaire David Tepper: over-inflated stock prices: Billionaire hedge fund investor David Tepper told […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[18769,1806],"class_list":["post-53340","post","type-post","status-publish","format-standard","hentry","category-economics","tag-birch-gold-group","tag-bubble"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/53340","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=53340"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/53340\/revisions"}],"predecessor-version":[{"id":53341,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/53340\/revisions\/53341"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=53340"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=53340"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=53340"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}