Seven Possible Causes Of Next Market Crash

Seven Possible Causes Of Next Market Crash
Mediamodifier / Pixabay

US household net worth recently topped $100 trillion for the first time in history, but actual US household income has only recently climbed back to levels seen in 2007, before the financial crisis – a possible signal of the next market crash, new research suggests. Financial security investigator and bestselling author Pamela Yellen notes:

Play Quizzes 4

When (and why) will the next market crash occur?

We are now in the longest running bull market in history at 9½ years – and no bull market has ever made it to its 10th birthday.

Get The Full Seth Klarman Series in PDF

Get the entire 10-part series on Seth Klarman in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues.

Q2 hedge fund letters, conference, scoops etc

Morningstar Investment Conference: Everything You Need To Know About Preferred Securities

Arena Investors Chilton Capital Management Schonfeld Strategic Advisors Robert Atchinson Phillip Gross favorite hedge fundsPreferred stock has been around for more than 150 years. One study suggests that the first shares of preferred stock were issued in 1836 by internal improvement companies in Maryland. However, some investors might not have given this asset class much thought until the government commandeered preferred shareholders' dividends in the government-sponsored enterprises Fannie Mae Read More

“While there’s no guarantee this bull market will crash before it hits its 10th birthday in early 2019, we do know that, historically, the longest-running bull markets go out ‘with a bang, not a whimper,’” Pamela says.

Possible causes of the next collapse include:

  1. Interest Rates Jump – “Risk-taking and leveraging have exploded. Interest rate increases that are faster than expected could push down stocks and commodities and trigger a domino effect.”
  2. Certifiably Crazy World Leaders with Their Finger on the Trigger – “The threats posed by countries like North Korea and Iran are very real… and very unpredictable.”
  3. Cyber Attacks and Disruptions to the Power Grid – Attacks by countries like China, North Korea, Russia, and Iran are becoming more common and more debilitating.
  4. Emerging Markets in Distress or Chaos – “Countries from Turkey to Argentina and South Africa are experiencing market and currency plunges, along with interest rate and recession woes which could spread to other countries.”
  5. China Could Crack – China has so far weathered the threats of a trade war and a rising But a real-estate crash or defaults of local government-owned financing vehicles could be the breaking point and would impact our economy.
  6. Trump Might Be Impeached – Although he would likely stay in office, confidence in the bull market that really took off when Trump got elected could be undermined.
  7. Very Tight Labor Market – An incredibly tight labor market has resulted in 911 emergency call centers not being able to get enough people to answer the phones. And prisons are now training inmates to be coders. What could possibly go wrong with that?

“The bottom line is that the current bull market isn’t going to last forever. If you don’t have a ‘Plan B’ for the next market crash and a significant portion of your savings portfolio in safe and liquid financial vehicles, you are in for some serious pain that could last for many years.” Pamela advocates The Bank On Yourself wealth-building strategy that’s never had a losing year in more than 160 years.

Updated on

Pamela Yellen is founder of Bank On Yourself, a financial investigator and the author of two New York Times best-selling books, including her latest, "The Bank On Yourself Revolution: Fire Your Banker, Bypass Wall Street, and Take Control of Your Own Financial Future." Pamela investigated more than 450 financial strategies seeking an alternative to the risk and volatility of stocks and other investments, which led her to a time-tested, predictable method of growing wealth now used by more than 500,000 Americans.
Previous article Ken C. Griffin: Markets In The Late Stage Of The Cycle
Next article Two Additional Accusers May Appear At Hearing On Kavanaugh’s Nomination

No posts to display