We're seeing the greatest asset inflation bubble in 20 years, fund manager warns
This article has appeared at cnbc.com by Natasha Turak
Nobody wants to use the 'B' word, but a bubble is upon us, a growing number of market watchers are warning.
And it could pop sooner than many expect, Centricus Asset Management Fund Manager Ralph Jainz said Monday, joining a long list of financial players casting doubt on the strength of the market's current bull run.
"Nobody wants to talk about this being a bubble. It's the greatest asset inflation bubble we have seen in 20 years," Jainz said during an appearance on CNBC's "Squawk Box Europe."
There is wide disagreement over whether markets have further to climb or whether we'll see a spectacular market correction. Investing titan Mark Mobius recently predicted an impending correction of up to 30 percent, while others see no cause for concern.
"Dispersion levels have been rising, people have been selling the losers to buy the winners," the fund manager said, describing stocks that were already expensive becoming more expensive — like those in tech — as buyers rush to those out-performers and in turn sell the underperformers.
Tech stocks have become so expensive, according to some investors, that many believe they no longer have room to grow.
Recently, Fasanara Capital, a London-based asset management fund, predicted a full-on crash ahead, citing increasing frequency of value-at-risk shocks — or swift market corrections — as an indication of fragility for global markets. Fasanara also accurately predicted the market correction in early February, saying just two weeks before that stocks were long overdue for a re-pricing.
The fund was not alone in pointing out that today's stock market is the most overvalued on record — more so than in 1929, 2000 and 2007.