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Wednesday, 26 Aug 2015
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The 1987 Crash

Its the 2017 thirty year anniversary of the 1987 crash. Everybody’s reminiscing. Coincidentally I too have found myself writing about stock-market bubbles in the last couple of weeks. Nothing to do with superstition. Superstition counts for nothing in the stock market. The bubble chatter is to do with the US market which is hitting record highs repeatedly and has seen share prices outstrip earnings by 27% since the beginning of 2015. On a price-earnings ratio of twenty-three times it’s certainly not cheap and with an unpredictable muppet like Trump in charge the narrative could very quickly flick to ineffective president, North Korean geopolitical risk, and an overpriced technology sector. The NASDAQ includes $10.4 billion worth of stock, trading on an average PE of 26.5x.

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