An Ugly Reckoning Coming

It’s not just stocks; everything is overvalued - Rex Nutting - MarketWatch: " . . . . short-term thinking is one reason why private-sector debts have exploded over the past 30 years. In the 25 years between 1982 and 2007, the private sector (excluding banks) added $23.7 trillion to its debt level, while the federal government added $4.1 trillion. For all the recent talk of an unsustainable public debt, it’s the private sector that’s in real trouble. The private sector has had to leverage up massively in order to afford the high prices it’s paying for houses, equities and other assets. What’s the result of all this financialization? Debts are too high compared with underlying economic fundamentals, but so are asset prices. No one’s sure when the reckoning will take place, but it’s likely to be ugly when it does." (read more at link above)


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