Add Mike O’Rourke, chief market strategist of JonesTrading, to the growing chorus of people warning of a market bubble.

Jeremy Grantham is another one. He calls the market action an “epic” bubble.

The co-founder and chief investment strategist of Grantham, Mayo, Van Otterloo & Co., spotted the dot-com and housing market bubbles early.

Find out why O’Rourke believes we’ve reached a tipping point for investor enthusiasm. And then have a look at a chart which shows Bitcoin dwarfing any bubble going back 40 years.

O’Rourke sees investor reaction to the possibility of the Biden administration attempting to pass a $3 trillion stimulus and infrastructure package, and doling out an additional $1,400 to Americans as the final catalysts for investor exuberance and says a market peak is near:

“With the expectation of $2,000 stimulus cheques (on top of the $600 being sent now) as part of an additional $1 trillion fiscal stimulus, the Biden administration has only fueled incredibly exuberant animal spirits in the financial markets. Don’t be surprised if this latest (and what should be the last) bout of fiscal stimulus marks the peak of the bubble”, O’Rourke said in a note to clients. 

Michael Hartnett, chief investment strategist at Bank of America, told clients to “sell the vaccine news”, pointing to “violent inflationary price action” over the last two months for assets like Bitcoin.

For argument’s sake, we’ll ignore any arguments that Bitcoin can’t be compared, for example, to the Nikkei 225 bubble in Japan in the late 1980s, and instead compare Bitcoin on an apples to apples basis to gold, market, housing and sector bubbles since the late 1970s.


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