Economic Data Show Potential Of Stock Market Bubble

The DOW (DIA) and S&P  are breaking new records yet the underlying data doesn’t support such valuation in the markets. What does the underlying data really say about the economy and what effect might this have on stock markets moving forward?

The Treasury just came out with their monthly and quarterly economic statistics and data as shown in the following two tables. A synopsis shows a rising trade balance for goods and services and a decline in industrial production since 2010, a decrease in Real GDP since 2010 and a declining personal savings rate. None of the first three, trade imbalance, decline in production, and decrease in GDP are good for the economy. But savers may indeed be pulling money out to invest in stocks in search of a better return as interest rates have fallen considerably due to Federal Reserve interference in trying to maintain price stability and reduce unemployment.




It is this move from savings to stocks that has possibly contributed to a higher stock market. But the economic data doesn’t support it. This, by definition, is a bubble.


While investors in general shouldn’t fight the trend, one can take profit. No one goes broke taking profit but it’s an Illusion of Wealth otherwise.  

Continued at 


Go To Buy Gold And Silver Safely Store
About Doug Eberhardt

Doug Eberhardt is a 28 year financial services veteran and precious metals broker selling gold and silver at 1% over wholesale cost. Doug has written a book to help investors understand how gold and silver fit into a diversified portfolio, how to buy gold and silver, and what metals to buy. The book; “Buy Gold and Silver Safely” is available by clicking here Contact phone number for Buy Gold and Silver Safely is 888-604-6534


Commodity Futures Trading Commission Futures and Options trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don’t trade with capital you can’t afford to lose. This is neither a solicitation nor an offer to Purchase/Sell futures or options. No representation is being made that any account will or is likely to achieve gains or losses similar to those discussed in this outlook. The past track record of any trading system or methodology is not necessarily indicative of future results.

All trades, patterns, charts, systems, etc. discussed in this outlook and the product materials are for illustrative purposes only and not to be construed as specific advisory recommendations. All ideas and material presented are entirely those of the author.