No offense taken. I was on Wall Street in another life.
I don't know if there will be a crash. The market went up slowly, it could also go down slowly. That's the Fed's goal, it seems.
I do think that any time a bunch of people are making a bunch of money without knowing how or why, but by simply following the herd, it is leading to a dangerous place.
This is happening right now in the S&P 500 and other index funds. Everybody is getting the same advice ("buy index funds") and following it blindly.
I expect there will either be some kind of sea change where the herd starts moving (possibly stampeding) in the other direction, or someone on Wall Street is going to figure out how to take advantage of the movements of the herd.
But this is all speculation. If I knew for sure, I'd be a billionaire in the next few years.
That's too risky. It relies on the herd running in a specific direction.
I'm talking about profiting off of the predictability that exists as a result of there being a herd. You can find a way to make money no matter what direction the herd moves.
To put it a different way, see that tree over there? Right now it is much more likely that 1,000 buffalo run past that tree vs. one and only one buffalo runs past that tree. That's how a herd works. This is the opposite of how the market usually behaves, and I imagine there is some mis-pricing to be found as a result.
I don't know if there will be a crash. The market went up slowly, it could also go down slowly. That's the Fed's goal, it seems.
I do think that any time a bunch of people are making a bunch of money without knowing how or why, but by simply following the herd, it is leading to a dangerous place.
This is happening right now in the S&P 500 and other index funds. Everybody is getting the same advice ("buy index funds") and following it blindly.
I expect there will either be some kind of sea change where the herd starts moving (possibly stampeding) in the other direction, or someone on Wall Street is going to figure out how to take advantage of the movements of the herd.
But this is all speculation. If I knew for sure, I'd be a billionaire in the next few years.