The stock market looks a lot like it did before the dot-com crash and ’08, says a top economist

Traders work on the floor of the New York Stock Exchange, October 13, 2008. REUTERS/Shannon Stapleton

  • The stock market is resembling the periods leading up to the dotcom and market events of 2008.

  • David Rosenberg pointed to the exuberance for AI, which has led to a “raging bull market.”

  • The “speculative mania” plaguing the stock market could end soon, he warned.

According to economist David Rosenberg, the stock market is showing the same warning signs of “speculative mania” that preceded the crashes of 2008 and 2000.

The president of Rosenberg Research – who mentioned the 2008 recession and sounded off on Wall Street amid the latest market rally – pointed to the “raging bull market” that kicked off in stocks, with the S&P 500 leading the way for the first time. exceeded the 5,000 point mark. time ever last week.

The benchmark index is up about 22% from last October’s low, crossing the official threshold for a bull market. The index has also risen over the past five weeks and is up fourteen of the past fifteen weeks – a winning streak not seen since the early 1970s.

But the huge gains are a double-edged sword for investors, as the market looks dangerously similar to the environment before the dot-com and 2008 crashes, Rosenberg wrote in a note Monday.

“Every day that goes by, this feels like a cross between 1999 and 2007. It’s a giant speculative price bubble for most risky assets, and while AI is real, so was the internet, and so were the high-flying stocks . that populated the Nifty Fifty era,” he said, referring to the group of 50 large-cap stocks that dominated the stock market in the 1960s and 1970s before falling by about 60%.

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