Tags: Anthony Mirhaydari | Stock Market | Boom | Bull

Money Manager Anthony Mirhaydari: This Bull Market Will Eventually End

By    |   Wednesday, 27 May 2015 11:49 AM

Anthony Mirhaydari, founder of Mirhaydari Capital Management, sees the end nearing for the current bull stock market.

“This bull market will eventually end,” he wrote in the Fiscal Times. “It's been nearly four years since the S&P 500 has suffered a 10 percent correction — the third longest run since 1960,” he wrote.

“Unless the global central banks have uncovered the policy equivalent of the philosopher's stone — creating wealth out of thin air — the boom will not last forever," he warned.

"Like death and taxes, the business cycle cannot be avoided. Economics is a social science; the study of man's propensity to make poor decisions when it comes to buying and selling, saving and borrowing,” he wrote.

“Booms lead to malinvestment, overcapacity, narrowing profits, and eventually, default and losses. It's inevitable. The movement of interest rates can control the flow but cannot stem the tide. Otherwise, monetary debasement would've saved the Roman Empire instead of precipitating its fall,” he wrote.

But as for what the specific tipping point could be, there are a variety of suspects.

“Timing is critical but impossible to predict. Will a Greek exit from the eurozone trigger a crunch? What about the long awaited interest rate liftoff from the Federal Reserve? Or a Chinese debt-default problem, amid tightening margins, over-indebtedness and falling prices?" he asked.

"How about the ongoing softness in U.S. GDP growth? Or the recent upward pressure on long-term interest rates as traders price in the rise of inflation and the potential end of the 30-year bull market in bonds?”

Other notable experts also expect the bull market to end soon.

Star bond-fund manager Bill Gross of Janus Capital Group warns that financial market bubbles are about to pop and that the bull market is nearing its end.

But Gross was asked by the New York Times if he thinks there is a bubble in stocks or in bonds?

“I think both. I sort of have a sense of an ending,” he said. “I think that the 35-year bull market in bonds and in stocks is ending. Now, when you say something like that, it conjures up a crash. It doesn’t have to be that way. It probably ends, like T. S. Eliot said, with a whimper and not a bang.”

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Anthony Mirhaydari, founder of Mirhaydari Capital Management, sees the end nearing for the current bull stock market.
Anthony Mirhaydari, Stock Market, Boom, Bull
Wednesday, 27 May 2015 11:49 AM
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