How ‘the mother of all bubbles’ will pop

HAVING tagged America’s inordinately large share of global financial markets as “the mother of all bubbles” in my last column, the main pushback I got, even from the few people who share my view, was that there is no sign this bubble will deflate any time soon.

Almost no one foresees an imminent pop. Virtually every Wall Street analyst predicts US stocks will continue outperforming the rest of the world in 2025. But all this enthusiasm only tends to confirm that the bubble is at a very advanced stage. If the consensus on “American exceptionalism” is so overwhelming, who is left to hop on the bandwagon and inflate it further?

The certainty of Wall Street has spilt over into popular media, which often picks up on market trends only when they are well established and near an end. Hype for American superiority is now the stuff of TV, radio, podcasts, newspaper columns and magazine cover stories, which have a record of pointing the wrong way on future trends.