Posted 4/1/2024, 2:56:00 PM
Strategist Warns Stocks Flashing Bubble Warning Signs Similar to Dot-Com Era, Sees Potential for Major Correction
- Stocks are flashing similarities to past bubbles as valuations are very high despite muted profit growth
- SocGen strategist Albert Edwards believes this is a sign the Fed's monetary policy is too loose
- Edwards points to the large run-up in stocks, expanding money supply, and expectations for Fed rate cuts
- He warns that anemic profit growth and overly optimistic analyst expectations don't justify current valuations
- Having foreseen the dot-com crash, Edwards cautions stocks could face a major correction, especially if a recession hits