Tag Archives: Bubbles and Debt

Debt and Recovery Ten Years Later

Debt – actually too much debt – played a leading role in the 2008 financial crisis.  A mortgage borrowing binge and a flood of mortgage backed securities set the stage for the collapse of Lehman Brothers and recession that followed. In the immediate aftermath almost every part of the economy went through a period of Read more […]

Valuations Are High but Dispersion Is Low

“Stocks Have Froth but No Bubble,” in today’s Wall Street Journal argues that while stocks are sitting at the highest valuations seen in many years, the market is not in a bubble.  Despite similarities to early 2000 by some measures, other distinguishing features of trading bubbles (such as high trading volume and high leverage) are Read more […]

Why Bubbles Aren’t as Dangerous Today

Both the surprisingly strong 2013 US stock market performance and the surging rebound in US home prices are sparking fears of another round bursting bubbles among many investors and market pundits.  While we don’t know the chances that either stocks or home prices will plunge in 2014, the collateral damage from either will be less Read more […]