Image Source: Unsplash

Below are some of the most interesting things I came across this week.

LINK

“Investors now rely on an ever-expanding Bubble Term that was driven by ‘free money’ monetary and fiscal policies that will not only have to persist – but will have to expand without limit in order to keep up with that Bubble Term,” writes John Hussman.

LINK

As Gunjan Banerji explains, “There has been a generational change among investors. Fewer remember calamities such as the dot-com downturn or even the financial crisis. Instead, the current crop of young investors have known mostly blue skies since they opened their first brokerage accounts.”

CHART

But the last time investors saw only blue skies and shunned defensive sectors in the way they do today didn’t work out so well. “The recent collapse in defensives’ sector weight relative to earnings weight closely parallels what happened in the run-up to the bursting of the dotcom bubble in 2000,” writes Robert Armstrong.

STAT

After the bursting of the Dotcom Bubble, small cap stocks outperformed for a number of years. Is the “largest annual outflow in history” (via barchart) clearing the decks for a replay of that period?

LINK

At least one successful contrarian seems to be finding compelling opportunities in the space. Eric Cinnamond writes, “As investors chase the high-flying mega caps, we’re finding value in small-cap dividend stocks.”

More By This Author:

Can Anything Stop The Stock Market?
AI Spending Is Eating The U.S. Economy
Monetary Policy Is Too Tight, You Say?