Most Asian stock indexes are higher, tracking gains after a turbulent session on Wall Street. U.S. futures were little changed and oil prices advanced early Thursday.
Judging by last time around, shit will spread from “bad industries” to the rest as the money necessary to cover the bad bets gets pulled out from saner investments.
This time around as there are at least 2 “oh shit!” bubbles (AI and unregulated car loans) plus quite a lot of smaller bubbles (such as realestate), the risk is that after any of the big bubbles explodes, via mechanisms such as the one I describe above the other big one is triggered and explodes next and then that in turn blows a bunch of the smaller ones.
Imagine the chaos after the various over-indebtness bubbles blow (not just car loans, but also things like the highest level of credit card debt since 2007), the AI bubble blows and the realestate bubble blows.
Judging by last time around, shit will spread from “bad industries” to the rest as the money necessary to cover the bad bets gets pulled out from saner investments.
This time around as there are at least 2 “oh shit!” bubbles (AI and unregulated car loans) plus quite a lot of smaller bubbles (such as realestate), the risk is that after any of the big bubbles explodes, via mechanisms such as the one I describe above the other big one is triggered and explodes next and then that in turn blows a bunch of the smaller ones.
Imagine the chaos after the various over-indebtness bubbles blow (not just car loans, but also things like the highest level of credit card debt since 2007), the AI bubble blows and the realestate bubble blows.