Stocks & Housing Prices Need To Collapse Another 40% Just To Get Back To The Median

Stocks and housing prices need to collapse another 40% just to get back to the median. 

October 6 (King World News) – Nick Gerli:  $80 Trillion – combined value of US Housing + Stock Market $25 Trillion – GDP There’s a lot more Wealth Destruction to go.

This Is What Happens When A Country Prints Way Too Much Money And Has Artificially Low Interest Rates

What’s amazing – is that even with the Stock Crash and start of Housing Correction – Asset Values are still 319% of GDP today. While that’s down from its early 2022 Highs, it’s still ABOVE the peak of the 2007 and 2000 Bubbles. More pain is coming…

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How much pain? Well to simply get back to a “normal” level of Asset Prices / GDP, we’d need a further 40% Combined Correction in Housing & Stocks. But of course…

40% Further Crash Required Just To Get Back To The Median (YELLOW DOTTED LINE)

…we could go below “normal”. We could go back to a level more like 150% Asset Price / GDP. Or 100% Asset / GDP. That’s what valuations were like in the 1970s during the last Great Inflation. Which would mean price declines more on the order of 60-70%.

How did Asset Prices go so high to begin with? Two words: Interest Rates. Low interest rates over the last 20 years caused Asset Prices to explode.

Yes Low Interest Rates And Money Printing Caused The Cocaine High In Asset Prices But Now That Interest Rates Are Reversing So Is The Cocaine High

But now Rates are rising – fast. And that’s causing a massive re-pricing of Stocks & Real Estate. Back down to the levels fundamentally dictated by the size of the US Economy & Incomes (aka, GDP).

King World News note: The audio interview with billionaire mining legend, Pierre Lassonde, will be released on Friday!

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