원문 보기
if and when we reach a period of pessimism the potential unraveling in terms of perceived wealth is much greater this time than it will have ever been before I think since I said that we could take out the rivaling 1929 and 2000 I think we've gone way past that there are examples of large scale craziness and meme investing etc for which there is simply no parallel in 19 29 even or 2000 2000 had pet.com and they were kind of glorious but they were scores of millions or a few hundred million we have crazy things now that are billions and in some cases tens of billions and uh we were the most impressive speculation I think there is nothing like that at scale even adjusted for current dollars in 1929 and we are down 80% which is a fairly fearful decline but along with us the next tier of speculative stocks also came down the spa index is down over 20% the market is a self-correcting mechanism but it's a little wonky in the time it takes sometimes it corrects pretty quickly and sometimes it corrects uh incredibly slowly and that's the problem but if you go back to 2000 which is the previous leader in speculation let's say what happened there is the market peaked in March of 20 and uh between March and September the uh pet.com basically went out of business the internet stocks basically went down 80% but the whole the whole uh TMT Bubble Burst and the industry which had been 30% of the market declined by 50% the S&P was unchanged and you could have said during that 5mon 6mon window oh isn't that healthy they're selling the flakiest pet.com and uh they're buying Coca-Cola what's not to like about that that's exactly what happened and I like to think of them as the kind of pessimism termites they at through the craziest first and then the junior growth stocks and then the intermediate growth stocks and then finally Cisco which was for8 minutes or so the biggest company in the world by market cap and they were all down collectively 50% the balance of the market was up 17% so that looked incredibly healthy but then the termites reached the broad market and the entire 70% rolled over and fell 50% in two years and the NASDAQ was down 82% the thing about the underpinnings is they always look terrific in 1929 the market didn't Peak when they thought the underpinnings were terrible they peaked when the Market's enthusiasm for the underpinnings was approximately the highest it had ever been in history in 2000 in March the world uniformly including the boss of the Federal Reserve serve alen Greenspan they all thought the system had never been better at the top of the housing bubble in ' 07 bangi and the boys thought the US housing market had never declined unquote it merely reflected a strong US economy the underpinnings were great they have never gotten it right the Federal Reserve in particular has never had a clue about asset bubbles it doesn't even address it they act as if they don't exist except on the upside they occasionally take credit for the wealth effect helping the economy along and it does there is an income effect and it does help the economy along and Greenspan banki and Yellen all took credit explicitly for helping the economy along what they never did is they never took discredit for the reverse side the market is me reverting mechanism and eventually it goes back to a fair price and when it went back in 2001 2002 it had a dreadful negative income effect when the housing market collapsed and it took the equity Market with it it had a double pronged negative effect on the economy so it had a much bigger impact on the economy than had occurred in 2000 and this time we're really playing with fire because this time unlike 2000 we have an overpriced bond market Jim Grant would argue the most overpriced in 4,000 years we have in my opinion and that of many other bubble students the most overpriced us Equity Market in history we have a housing market that three weeks ago reached the same multiple of median family income as it did in 2006 at the peak of the housing bubble and we have Commodities that have recently run a Muk so that the Goldman Sachs index of non-energy which is food and metals which are pretty important have just equaled the peak of 201 which was said to be one of those super cycle commodity events so this is the first time we've ever risked 3 and a half asset classes bubbling at the same time if and when we reach a period of pessimism the potential unraveling in terms of perceived wealth is much greater this time than it will have ever been before you quoted Robert Schiller Nobel prizewinning Economist about the fact that he said that even even though his indices are showing the market at extreme valuations that really compare it to the bond market which as you said is very expensive stocks don't seem so overpriced what is your response to those kinds of arguments I think the U interest rate argument is an explanation of how we get there in behavioral terms it is not by any stretch of the imagination of justification you don't justify anything by taking the most overpriced asset in the history of man the bond market I'm saying compared to that we are merely very overpriced and therefore relatively cheaper that is very cold comfort Solomon Brothers an important firm at the time in 1989 sent around a hit squad justifying the Japanese stock market which was approaching 65 times earnings we were told at the time the data was represented as 65 times earnings that had never previously sold over 25 and so that was to say the least The Real McCoy and this team went around pointing out that the rates in Japan were so low that 100 PE would be fair of course the collapse that followed in land and bonds and and stocks was Cosmic in 1989 and it still hasn't recovered it still hasn't reached the 1989 level in either their real estate market or their stock market which reminds us of the cardinal rule and that is the bigger the bubble the most ingenious the arguments and the bigger the bubble the most extended and painful the decline this is the most broad as I said asset bubble of all time with three and a half of the four major asset classes clearly in severe bubble territory thinking that you have no alternative but pick between one of the four bubbles is a pretty Grim way to view life I get the argument so pick a bubble they'll all go together probably and you will suffer a lot of pain and the intellectual content of that argument that they were all bubbles so we had to pick the least bad one will um resonate in your head as the market unravel you had a dozen to 15 years of flat Market with earnings doing okay and rotation within the market everything would work out fine and every portfolio manager I almost ever met has felt in market bubbles
Comments 0