Damien Klassen on What Will Burst the Bubble | ABC’s The Business

Stock markets have disconnected from fundamentals (and reality). The economic fundamentals are almost as bad as they have ever been. Stock market valuations are as expensive as they have ever been. But that hasn’t concerned markets.

Nucleus Wealth’s Head of Investments Damien Klassen spoke with Rachel Pupazzoni on ABC’s The Business about what the latest layoffs at Qantas indicate, why he believes we’re in a bubble and the forces that are driving it, if a second wave of COVID-19 will spur another market fall, and what he thinks will burst the bubble

 

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Damien Klassen is Head of Investments at the Macrobusiness Fund, which is powered by Nucleus Wealth.

Follow @DamienKlassen on Twitter or Linked In

The information on this blog contains general information and does not take into account your personal objectives, financial situation or needs. Past performance is not an indication of future performance. Damien Klassen is an authorised representative of Nucleus Wealth Management, a Corporate Authorised Representative of Nucleus Advice Pty Ltd – AFSL 515796.

Leith van Onselen
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Comments

    • Cash.
      Return comes in two forms – return on investment ( dividend, interest etc) and purchasing power (today’s cash, buys more of tomorrow’s goods)
      In all likelihood, it’s going to be the latter, also known as Deflation. Even cash ‘earning’ minus 2% in the bank is a positive investment if prices fall, say, 3%…
      What’s the old mantra ” Buy low, sell high” and what’s the lowest of the low at the moment? Cash!

      • DominicMEMBER

        With the greatest respect I think cash is a terrible place to hide out. Always worth having a small stash of it but not a place for your savings. There is almost zero chance of deflation.

  1. The Fed has expanded the money supply in anticipation of companies going under and bad debts piling up but they haven’t even allowed any companies to fail, same as in Australia. I think they anticipated this to last 6 months. It will be interesting to see if they extend their generosity if this drags on for much longer.

  2. Ronald Stewson

    House prices will be allowed to fall only when most of the baby boomers are dead. Until then it will be lower teh rates, print money, super into housing, open teh gates, etc.

    If we were smart we’d open teh gates to European women, who don’t have Coronavirus and would make good mates with Aussie blokes, who’d then promptly increase population multiple times and forge increased demand for housing.

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