In line with the above quote of Sir John Templeton, the current bull market was also born in the midst of stark pessimism owing to the Covid crisis some 18 months back. Since then, global financial markets appear to have embarked on a one-way journey in which there has been no looking back.
But while this excess liquidity-fuelled bull market is on, cracks seem to be developing both on Wall Street as well as in real economies.
Excesses & Incidents
Excesses have always invited pain in the stock market. In March-April 2021, one of Wall Street’s biggest hedge fund managers, Bill Hwang, went bust after his fund Archegos Capital lost $20 billion in just two days. That had to do with excessive borrowing. That incident substantially bruised and battered the wealth management division of Credit Suisse.
In Beijing, real estate giant Evergrande…