Possible bubble may lead to market crash
Bain’s CEO thinks private equity has taken on too much debt. He told FT that we are in a bubble and any economic downtown will bring down the leveraged buyout house of cards, taking down the economy. What do you think? Time to start shorting in baby steps?
Lots of people are predicting an economic downturn, which is reasonable since this is the largest period of extended growth in us history, iirc. Where these predictions differ is 2-fold: when and how severe. Predictions on time range from we're already in it to 2025. Predictions on severity range from housing crash 2.0 to... We're already experiencing the recession.
As of this June it’s going to be the longest expansion ever: >120 months. I think it may go for longer. The Fed didn’t see a reason to raise interest rates, which tells me at least they didn’t see any signs of overheating.
No one is smarter than the market. Stay the course with your index stock/bond split.
"private equity" = "Chinese billionaires" Just to be clear what we're talking about.
Absolutely, that's well known. They ran a shadow banking system for decades that allowed Chinese banks to make massive "off book" loans, which Chinese businesses then went and used to go on a global buying spree. Recently the Chinese have started cracking down on shadow banking and it's causing a risk of default as these loans come due and refinancing is difficult. Google "China shadow banking" and then realize that money went global via private equity