Blackstone Strategist Calls This Investment the ‘Mother Of All Bubbles’

Blackstone strategist Joseph Zidle believes that he has identified the “mother of all bubbles” — the sovereign bond market.

Zidle wrote back in August that “negative-yielding bonds total over $16 trillion globally.” 

The strategist identifies three ways that an investor can lose money when investing in a negative yield bond:

1) Lost principal when the investment is held to maturity

2) Less purchasing power due to the effects of inflation 

3) Opportunity costs relative to investment returns more than zero over 

Zidle believes that when the sovereign bond bubble bursts it will set off a chain reaction across the economy, similar to the way that the U.S. subprime mortgage crisis of 2008 created a house of cards to fall on itself.

As to when the recession will occur, Zidle writes, “I don’t expect a recession in six months, but I don’t think it will be as far out as two years from now, either.”

To those who doubt whether or not the sovereign bond market is in a bubble, Ziddle notes, “If there was any doubt, one sure sign of a bubble is when people stop questioning whether it’s a bubble.”

Stock market crash

Harris Kupperman, president of Praetorian Capital Management, also believes the economy is due for a nasty shakeup.

Kupperman thinks that a stock market crash is coming very soon. 

“Over the past few years, I have been increasingly concerned about the massive structural imbalances in the world, along with excess debt and asinine monetary policy leading to an epic equity market bubble,” he contends.

Kupperman places the blame on the Federal Reserve. 

“When you push liquidity through the system like they have the last ten years, you create a giant bubble.”

Kupperman also places much of the blame for a possible upcoming stock market crash on unprofitable or close to unprofitable companies selling at excessive valuations.

Writing about companies such as WeWork and Tesla, Kupperman says, “these things literally have no economic rationale to exist except for the fact that liquidity has been pushed through the system, and people keep buying shares because they believe that there’s some other sucker who’s even dumber than they are.”

biden wins

What I’m Telling Investors to Do If Biden Wins the White House

The value of our Bulletproof Wealth Report model portfolio declined modestly over the past several trading days ending Sept. 27, while the Dow Jones Industrial Average fell by 822 points

Options: Meandering Market Tamed by Using a Straddle or a Strangle

When you hear talk of markets trending, people think of uptrends or downtrends. However, markets often get stuck in a trading range. This is the condition where there is no

Warning! Market ‘Death Cross’ Appears

A death cross! According to Investopedia: The death cross is a technical chart pattern indicating the potential for a major selloff. The death cross appears on a chart when a

5 Best Stocks to Buy If Trump Wins the Election

If President Donald Trump wins the election on November 3, 2020, you might want to consider adding these five equities positions to your portfolio: LMT, BAC, AMZN, XLE, TWTR. Why?

5 Best Stocks to Buy If Biden Wins the Election

If Vice President Joe Biden wins the election on November 3, 2020, you might want to consider adding these five equities positions to your portfolio: XLU, TSLA, XLV, MLM, and

TGIF — Ending the Week with a Whimper

Everything is proceeding as I have foreseen. In Monday's "The Week Ahead — 200,000 Deaths Weigh Heavily on the Market," we knew the 200,000th American death would put Covid back

Even If the Overall Market Continues Lower, This Staple Could Maintain Its Upward Trend

Since peaking in early September, the main indices have all three stumbled for the last few weeks with the S&P and Nasdaq falling over 10% from their highs already. Three

tesla stock

TSLA Too Volatile? Two Option Strategies for Tesla Stock

Tesla Inc. (TSLA) is one of the most popular stocks amongst investors. Led by CEO Elon Musk the electric vehicle manufacturer has disrupted the transportation industry, bringing hype to a

pot stock

Pot Stock ‘Blood in the Streets’ Buy Signal Is Here

The cannabis market has been a volatile space in recent years. A wave in legalization, particularly in Canada but also through parts of the United States, led to significant growth

Use Options as Portfolio Insurance in Rocky Times

Since the beginning of September we have seen the main U.S. indices drop. There are a number of possible reasons for the decline, but more importantly I expect the increased

4 Foreign Countries Where You Can Retire On Social Security Alone

Someone once said that retirement is not the end of the road but a highway opening to a new chapter in life. Whoever said that clearly has never experienced a

We’re Beating the Index Off the March Low: Update

The Bulletproof Wealth Report model portfolio is continuing to perform well and is now up 27.4% since the inception of our monthly newsletter on April 13, 2018. Although the value