Bull markets, bubbles and Swiftonomics

“It was the worst times, the age of wisdom, the age of stupidity.” This captures the dislocation between political events and market action as it enters next week.

The closure of the US government has created concerns about its globally negative impact, but seems to have reduced risk sensitivity in large equity markets. Washington seems to continue next week, the political locking on the DC, with concerns that the Trump administration can permanently reduce financing ice cream and cancel certain projects.

While a lot of research has been conducted on what a expanded closure for stocks may mean, large US and European indices recorded record heights. This shows that the fund flows from Bank of America have moved to global stocks of $ 26 billion during the week ending on October 1, and a record of $ 9.3 billion to the technology sector.

But another narrative is growing in the midst of this optimism. Increased number of market participants warns that bubbles are formed in some parts of the market, and some say it can lead to a larger market correction.

Saxo’s warning “guess, prepare”. Recently, in a note, the bank “mood could not be even more conflict. Stock indices are approaching record peaks … However, the date of consumer remains close to low levels”, encourages investors to diversify against instability.

Especially in the credit markets, there are red flags. Bank of America, Barnaby Martin, “Squawk Box Europe” in his latest polls, credit investors showed that this questionnaire “the biggest weight of the 20 -year history” showed that there is increasing concerns about market balloons, he said.

Last week, the US automobile parts manufacturer’s first brands, using non -balancing financing, after revealing a pile of 12 billion dollars of debt pile of bankruptcy applied. Famous short seller Jim Chanos Told the Financial Times “Suspects that we will see more of them” that the expanding private credit market has the echoes of the Subprime crisis.

A balloon that does not appear under the risk of explosion is a bubble around the multi -award -winning pop star Taylor Swift. His latest album “The Life of a Showgirl” was released worldwide on Friday, which lasted for months for fans. It is only followed by Eras tour that broke a record in ticket sales of $ 2 billion.