Charting the bank (CBA) bubble

Tuesday, 3 March 2015

From Morgan Stanley comes the growing bank bubble (my words not theirs):

Or, more to the point, rampaging CBA:

As I’ve said before, these valuations can be seen as quite rational in a low interest rate environment. The problem in Australia’s case, and what makes these valuations bubbly, is the economic adjustment associated with the unwinding commodities boom.

About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.