Market Expert Predicts An Unprecedented Market Bubble Is Right Before Our Eyes
Joseph Zidle, the chief investment strategist of Blackstone's private wealth solutions group is reporting the there are signs including the "mother of all bubbles" for an upcoming recession, according to Business Insider.
10 years ago, Joseph Zidle's boss used a framework that allowed him to predict the housing crisis. Now, he has adopted the same practice and is seeing very similar warning signs for another economic downturn. He believes that many warnings that signs that are typically looked over are adding up as warnings to investors.
One of these signs, he calls the "mother of all bubbles." This bubble is related to sovereign debt. Investor sentiment regarding negative government bond yields is the largest factor Many investors consider negative bond yields as normal, even though the global stock of negative-yielding debt in total adds up to an unprecedented $13 trillion.
Soaring prices have led to the negative government bond yields, and the issue is that fixed income is typically used to mitigate losses during volatile market changes. Some investors are buying sovereign bonds for their price appreciation, rather than the steady yield and protection.
"The failures in the repo market, negative-yielding debt, a deeply negative term premium, trade conflicts around the world and a collapse in manufacturing all seem unrelated right now, but I don't think they are random," Zidle said.
Joseph Zidle is the chief investment strategist of Blackstone's private wealth solutions group and is encouraging investors to be wary of the way fixed income is being treated, and that the "mother of all bubbles" could devastate portfolios.