Where Did the Bubbles Go?

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Notice something missing? It was all the rage not long ago. We’re talking bubbles.

Every time a financial asset ticked up even a tiny bit everybody yelled “it’s a bubble.” A stock would go from $100/share to $105/share and yells of “its in a bubble” would be everywhere. Same for bitcoin. A ‘run’ from $30K to $31K would elicit “bubble, bubble bubble.” So now that markets are at all time highs, AI stocks are on fire, bitcoin is looking to rush to $100K, house prices are constantly increasing, where are the bubble yodelers?

So where DID all the bubbles go? Well perhaps they didn’t just burst (or pop) like the bubble bellowers thought, but rather those bubbles have just been getting bigger and bigger. It might also be that the bubble crowd is now long all those “overpriced” assets. Having realized that being a “non-believer” (or, bubble yeller) wasn’t paying the bills, those same folks have jumped aboard the financial asset train and are all in. Which, of course, is not in their best interest to yell “it’s a bubble” anymore.

Now, of course, bubbles don’t just go away, right? They either pop or continue inflating. Since stocks have reached record levels, housing is at record highs, bitcoin (crypto) set to jump higher and even gold having record runs, the financial asset bubble is still around. But larger. Which leads to an interesting conclusion; if nobody is crying “it’s a bubble” perhaps this IS the “big bubble”.

So if you are a bubble believer and want get in on the next BIG bubble before it gets to big, look at wages. Specifically union wages. Airlines a few months back gave in to their pilots and other workers granting huge wage increases. In fact, Southwest is still negotiating with their workers. Then the recent East and Gulf Port Longshoremen got a 62% (over 6 years) wage increase BUT still have not ratified the contract. Now workers at Boeing, AT&T and others are drooling (while they strike) over huge potential pay increases and checking Ferrari prices. The wage bubble is getting larger……and stoking inflation.

Again, where did all those bubbles go? Oh they are still around, reflating, growing larger and just waiting for the cheerleaders to return. GO BUBBLES! GO BUBBLES GO BUBBLES!