As we all know, the rich get richer, and this is one way that they do it: well-to-do managers pump the market up buying too much stock (and other "instruments"), give everybody raises and bonuses, then crash it (by selling short to take profits). Then, when you are out on the street, you will be happy to work for less, and this is how they get you cheaper. The next rise will probably be less than the previous because of inflation, which outpaces the market--many of the rich are actually getting poorer (as measured by the DOW index in comparison with inflation), but they still get a bigger piece of a smaller pie, which assures you won't be bothering them on their private beaches! Inflation is key (devaluation of money) as it reduces debt for the banks and other investors.
Economists point out that personal debt is reduced by inflation in ways that show "corporate personification" (a legal form of anthropomorphism?). If you oppose inflation, economists (especially highly popular liberal economist and Noble laureate Paul Krugman) will state that you want to make all poor. NO!, I just want to end the viscious cycle. In some economists' thinking this makes me conservative--I thought it was communism!
Typical indicators are that showing dangerous levels:
* Stock values are above expected earnings
* The recent bull market (since 2009) is within a few percent of the highest run ever
* High-end investors (banks) moving from stocks to mutual funds
* Infamous VIX is showing that investors think FED will bail them out (psych)
* NASDAQ is soaring (remember tech crash of Y2K?)
* Herd instinct taking over: "buy whatever moves"
Current Bull more synthetic than most
Conservative BEARS are pointing out an interesting fact: the current bull market "bubble" is more synthetic than most as it is purely the product of "Keynesian stimulus" --of which Paul Krugman is the best-known proponent. The current "bull" guaranteed President Obama his re-election as he could no longer rely on the "people of color" who initially elected him, but whom he consistently disappointed and could no longer depend on.
References
These articles from mainstream newspapers are predicting a downturn that may be extreme:
4 potential killers lurk as bull market hits 5 (USA Today)
Are You Prepared for the Next Crash? (Wall Street Journal)
Get Ready for a Cataclysmic Market Crash! (Wall Street Journal)
7 signs we're near a market top, and what to do now: Wall Street is reliving the 1960s, but the 'Go-Go' era is ending (Market Watch)
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