Economist Henrik Zeberg has made a bold prediction, stating that the economy is currently experiencing an “everything bubble” that is set to expand even further. Zeberg, a well-respected analyst in the field of macroeconomics, believes that the bubble has not yet reached its peak.
To support his claims, Zeberg points to market capitalization to GDP ratios from previous bubbles, including 1929, 2000, and 2007. He notes that the current ratio is at a staggering 188%, indicating the potential for further growth. Additionally, he highlights the growth of the Crypto and Private equity bubbles, suggesting that the next recession could cause the “everything bubble” to burst.
Adding to his argument, Zeberg references data from Ernst & Young, which shows a significant increase in private investment over the past decade. This rise in assets under management further supports the notion of an expanding bubble.
Furthermore, Zeberg observes that central banks, such as the Federal Reserve and the European Central Bank, typically lower interest rates before a recession. He questions whether the recent rate cut by the ECB signifies the end of an economic expansion cycle rather than the beginning of a new one.
Overall, Zeberg’s prediction of an expanding “everything bubble” raises concerns about the stability of the economy and its potential repercussions in the coming years.