Global Stocks Plunge Again And A Former Reagan Administration Official Is Warning Of A “40% Crash”
by Michael Snyder
TheEconomicCollapseBlog.com
11/5/208
Stocks are falling again, and many believe that this new crisis is only just beginning. After a disappointing end to last week, a lot of investors were hoping for a bounce to start this week, but so far that has not materialized. As I write this article, all the big markets in Asia are down, and it looks like it is going be be a rough morning for Wall Street. Of course we probably won’t see too much movement as global markets wait to see what happens on Tuesday, and those results could potentially move things up or down substantially. Ultimately, I have a feeling that Wall Street will not be too happy if control of Congress is divided, because that would almost certainly mean that very little will get accomplished in Washington for the next two years. Instead, we will likely see even more bickering and fighting than we are seeing now.
But no matter what happens in the short-term, a lot of experts are convinced that the big market crash that everyone has been waiting for is finally here.
One of those experts is David Stockman.
Stockman is a former member of Congress, and he was the Director of the Office of Management and Budget under President Ronald Reagan. These days he is a frequent contributor on CNBC, and he recently told the network that there will be “a 40 percent stock market plunge”…
David Stockman warns a 40 percent stock market plunge is closing in on Wall Street.
Stockman, who served as President Reagan’s Office of Management and Budget director, has long warned of a deep downturn that would shake Wall Street’s most bullish investors. He believes the early rumblings of that epic downturn is finally here.
Because our financial system is even more leveraged today than it was in 2008, a plunge of that magnitude would be absolutely disastrous. Virtually everyone would need a “bailout” at that point, and economic activity would decline dramatically as the flow of credit dried up almost completely.
Needless to say, we would find ourselves in a very harsh recession very rapidly, and that is another thing that Stockman is anticipating…
“We’re going to be in a recession, and we’re going to have another market correction which will be pretty brutal,” Stockman said.
Of course Stockman is far from alone. Another economic expert that is warning of an imminent crisis is Mish Shedlock…
In the last 10 years not a single fundamental economic flaw has been fixed in the US, Europe, Japan, or China. The Fed was behind the curve for years contributing to the bubble. Massive rounds of QE in the US, EU, and Japan created extreme equity and junk bond bubbles. Trump’s tariffs are ill-founded as is Congressional spending wasted on war.
The Rest…HERE
