The Economy Sure Looks Headed for a Fall

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It’s not just e-commerce that’s partying like it’s 1999. The stock market is doing it too:

Those looking for reason to worry don’t have to search far. There’s a potential war with North Korea and ongoing drama in Washington D.C. But stepping aside from politics, the market has tended to drop when just about everyone thinks the good times will never end. Some people think we’re hitting “peak giddiness” now. Consider these stats:

63 percent of Americans believe the stock market will be higher a year from now…This is the highest level ever recorded by the survey…60 percent of market experts are bullish and only 15 percent are bearish…The P/E ratio, a widely watched gauge of how expensive the market is, has topped 21 for the Dow…It was 20 heading into the 1987 crash.

Venture capital looks giddy. The stock market looks giddy. Housing prices look giddy. I’m cautious by nature, so maybe it’s best to ignore me. And on the positive side, we don’t have a huge debt bubble right now that could turn a recession into a great recession. But even an ordinary recession would be painful. Color me one of the worriers.

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FACT:

Mother Jones was founded as a nonprofit in 1976 because we knew corporations and the wealthy wouldn't fund the type of hard-hitting journalism we set out to do.

Today, reader support makes up about two-thirds of our budget, allows us to dig deep on stories that matter, and lets us keep our reporting free for everyone. If you value what you get from Mother Jones, please join us with a tax-deductible donation today so we can keep on doing the type of journalism 2020 demands.

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