Source: The Mother Of All Irrational ExuberanceNone of them, it might be noted, were valued at 280X shrinking net income, as is Amazon today; or at infinite PE multiples like much of the biotech sector and momo hobby horses like Tesla.More importantly, the promising macro-economic situation at the turn of the century has given way to a world precariously balanced on $225 trillion of debt and the tottering $40 trillion Red Ponzi of China.
This coincidence must alert readers that a tempest is brewing on subjects noted: lurking inflation, increasing debt, suppressed interest rates and the shifting of hegemonic power. There are only two important questions in investing that also apply to subjects impacting the future stability of the world — tell me why and tell me when. Plender gives us the “why”, the ever-increasing “intolerable burden” of government debt and suppressed rates leveraging the global financial system. He gives us the tipping point. What we await is “the when”, as in when do we know we have “tipped”. Paul Hackett Madison, NJ, US Letter: Why the geopolitics of international currency choice matters
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