Is The "Everything Bubble" About To Pop? \ stacker news ~econ

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This is a must read for evryone who wants to understand the current scenario of economy not mentioned as a Bubble!

Here are two little paragraphs from the article, I'd recommend you to read the whole.

Is the "Everything Bubble" about to pop? Let's start with what we're told: there is no bubble, all the assets soaring to unprecedented heights are reasonably priced at a "permanently high plateau" because of AI, scarcity of housing, scarcity of Ferraris, interest rates trending down, the Fed waving dead chickens around the campfire, people buying toothpaste, and so on: you name it, it's a reason for assets to drift higher.

This all sounds rather splendid, but somehow the pump inflating the bubble goes unmentioned: it's the money, Honey, the tens of trillions of yen, yuan, euros, dollars, pesos, etc., being borrowed or conjured into existence since the last spot of bother in 2008, where each unit of currency enters the global free-for-all chasing assets.

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185 sats \ 7 replies \ @Undisciplined 6 Sep

I doubt I'll have time to read this today, but that won't stop me from sharing some thoughts.

The concept of a bubble is inherently about economic distortions. Some bubbles are sustainable (subsidies for example) and some are not (artificial credit expansion). A bubble means too much capital has gone into a sector, given that sector's productivity.

The "everything bubble", as I see it, is the monetary premium that has become attached to almost every asset because our fiat does not work as a store of value. The "everything bubble" will burst when Bitcoin emerges as the global store of value, which isn't imminent.

184 sats \ 6 replies \ @Coinsreporter OP 6 Sep

Thanks! You really made it simple for me to comprehend it better now. The article says a lot of things about "everything bubble". There are quite a few charts as well. I can say, it's been posted after a very intelligent study on the topic.

The "everything bubble" will burst when Bitcoin emerges as the global store of value, which isn't imminent.

There's no doubt about it. That also means that like me you also believe that the world is now living in 'an everything bubble' or 'the everything bubble has just started'?

21 sats \ 5 replies \ @Undisciplined 6 Sep

One of my favorite economic quotes is from Doug Casey:

"It's metaphysically impossible for everything to be overpriced."

I think "everything bubble" is a cool term, but isn't really accurate. The bubble we're referring to began at least as far back as when we went off the gold standard. That's when the store of value function of money was destroyed. Since then, the monetary premium on pretty much all durable assets has been increasing.

This is actually related to my post Reflections from the Nakamoto Simulator.

106 sats \ 4 replies \ @Coinsreporter OP 6 Sep

Yupp! I surely agree on this. The inflation that's at killing point is also much related to this in most of the countries. India does follow a bit of Gold Standard till now. May be that's why we don't witness as much inflation as you guys do there?

21 sats \ 3 replies \ @Undisciplined 6 Sep

Our price inflation is dampened, because we export it to the rest of the world.

77 sats \ 2 replies \ @Coinsreporter OP 6 Sep

I'm sorry I just didn't get it. What do you mean by 'export it to the rest of the world'?

21 sats \ 1 reply \ @Undisciplined 6 Sep

Since the dollar is the global reserve currency, when we print new money and spend it here, prices also rise everywhere else that uses dollars. Those other places don't get to spend newly created dollars, but they do experience the inflation.

This is what Cantillon Effects are. The first spenders of newly printed money benefit at the expense of the later spenders, because prices don't adjust until after the money is spent into the economy. America spends dollars first, then they slowly trickle out to the rest of the world.

87 sats \ 0 replies \ @Coinsreporter OP 6 Sep

Thanks! The Cantillon that discusses about the booms and busts! I got it now. So, USA spends dollars at the expense of rest of the world. This is definitely one big issue which the Russians and Chinese already know, not surprised that they are dedollarizing because they are foes to America. ECB with EURO aimed at the same thing. EURO was invented with the aim to overcome dollar supremacy, but it has now failed! Am I right?

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285 sats \ 1 reply \ @IamSINGLE 6 Sep

It's a very comprehensive article. I think it'll take me hours to fully get it. I've read it in parts though and it seems like an eye opener! But as said will read it later.

34 sats \ 0 replies \ @Coinsreporter OP 6 Sep

Yes, it's comprehensive. But it's interesting. Come back to tell me your views after reading it.

21 sats \ 0 replies \ @Athena 7 Sep

Great article. Thanks for sharing

21 sats \ 0 replies \ @Trixie_K 7 Sep

Great Article! There's so much knowledge in it. Thanks for sharing.

0 sats \ 0 replies \ @BitcoinAbhi 7 Sep

I did not hear about it. By the way article gives great knowledge about it. Thanks for sharing