Tuesday, April 13, 2010
Impossible returns create bubbles?
Investors are creating asset bubbles as they move around the globe. Earlier this year there were worries about a commodities bubble. Now a bubble in bonds is ready to burst. Property is also on the way back. In the early 1990s it took property prices six years to begin growing again after the recession and 10 years to recover their losses. This time they declined for 18 months at most and in London are racing back to bubble-like levels, despite this recession being the worst for 60 years.