With due respect to the adage that any question asked in a headline is going to be answered ‘no,’ … Yes.
A simple google search for the terms ‘stock market’ and ‘overbought’ will return numerous results from influential financial news sites such as The Street and Market Watch detailing how precipitously high the market is trending and how tenuous the fuel powering that rise.
In point of fact, it’s an open secret that nothing was fixed after the Great Recession, and now with the anti-regulationists installed by the Trump administration being given free rein, what few safeguards were in place are currently being gleefully hobbled and stripped away all to the happy-horseshit tune of ‘the market will fix all.’
Well, the market is run by people, and those people frequently enough cut corners, cheat, and use inside information. Sometimes they just act stupidly because the deals they’re involved in are so multi-layered and complex it’s near impossible to figure out what’s really going on.
Stupid regulations are horrendous. No regulations is even worse.
And now, for some reason, the same site that gave us a warning call a couple of months ago that the market is overbought, is now running a piece that advises millennials to get in 100% in stocks. Anyone under 50, author Philip Van Doorn, should but up to their eyeballs in stocks, or risk missing out.
Historically, there is reason to take this position. Averaged out over the decades, the stock market has given better returns on practically anything you can think of other than unicorns. However, if the market is on record highs, but it’s not based on extraordinary corporate earnings and outlook or a rising middle class, then the higher the market goes, the more likely it is to crash, and crash hard.
More than that, if you invest at the height of a market, when it does crash, it might take years or decades to recoup. When I was a boy in the early 80s, I remember my father being talked into buying gold by an uncle because of the massive returns it was seeing. It crashed soon after and the market only recouped to that level within the last few years – and long after my father’s retirement and eventual passing.
Advice to millennials to buy the stock market under these conditions is wildly irresponsible. The rise of the market is based not on fantastic economic growth and prospects, but on the same insider dealing that gave us the crash of 2009 – and the next one is likely to be even more painful.
No – the stock market should only be part of the millennials’ portfolio – and the rest should be in instruments that promise far greater returns.
And that is the reason for Bitcoin’s existence. It was built to be a non-governmental money that cannot be controlled, manipulated, or civil-asset-forfeitured. It is the cash of the internet, and totally in the control of the individual once they have taken the time to learn how to handle it (a steep learning curve, but actually less than learning how to confront the myriad fine-print riddled scams of the banking system).
Bitcoin currently stands at about 1,450 dollars a coin with a market cap of about 24.5 billion. It is experimental and temperamental, with a few teething pangs still to work out (otherwise known as the scaling debate). But, when push comes to shove, you are going to see the smart money, and smart money, pour into safe-haven assets like Bitcoin. And when that happens, that lofty market cap go from the equivalent holdings of a single billionaire to a tenth or more of the world’s GDP.