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



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.

Unconventional Economist


  1. Goldstandard1MEMBER

    Well done Damien, proud to be a member here and seeing you on the mainstream comms.

    • +100% Excellent interview. No wonder Damien’s balanced and insightful opinion is being sought.

    • 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!

      • 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.

    • BoomToBustMEMBER

      They are taking our own money, then using to invest and compete against us with this money.

  2. 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.

      • Yep, the path to MMT. Central bank funded Govt deficits. I still think they’ll prop up asset prices if need be. This is the Fed taking its foot off the gas for a bit because they pushed a little too hard to begin with.

        • Yeah i think so and wolf wrote bout how fed was getting mild criticism from those they care about. Issue however is, even if u push too hard, u have no choice, u gotta push harder next time around.. foot of the pedal cant really work for long if the floor has fallen out. So it remains to see if those they care about have sold into this upturn enough to let fed let it fail lol. As long as the loses are aimed at the right crop..

          • Yep, they will need to stimulate perpetually because money printing does not fix the problem, it makes it worse.

  3. 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.