The Fed’s latest stock market bubble is at risk of blowing up.
It could blow up as soon as the Fed’s next meeting this Wednesday, or it could last longer. Either way, it is doomed.
Bubbles are inflated when the Fed recklessly creates more and more new money. The new money has to go somewhere and lately it has gone into stocks.
The question of the moment is whether the Fed will “taper” its money creation this Wednesday. The mere suggestion of such a “taper” sent markets into a tailspin earlier this year, so the Fed may or may not dare to make a move now.
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