A Stock-Market Crash Foretold
On the eve of World War I, when it was already apparent that the geopolitical order was crumbling, the stock market remained buoyant. There is every reason to believe that the US stock market’s current sky-high valuations, despite obvious geopolitical and economic risks, are vulnerable to a sudden shift in sentiment.
Wall Street traders have been known to joke that the longest river in the emerging-market economies is “de-nial.” But given the irrational exuberance gripping the US stock market – which is trading at historically high valuations, despite escalating geopolitical risks and reckless economic policies from President Donald Trump’s administration – one might think they are running cruises on it.
