Wednesday’s With Axel…”Bubble Indicator”

While it has been fun reviewing our Private Client Event with the founder of the Merk Funds, Axel Merk, as we set sights on fall, we are nearing the end of our discussion for now. We still have more to talk about in the future, and of course we are not finished just yet!

Axel Merks’ Favorite Bubble Indicator

Complacency, as simple of a word, it has great meaning in the capital markets, as described by Axel. When certain areas of the capital markets begin to ….let’s say, “take things for granted” or become complacent, Axel and his team take notice.

We agree, while it may seem like a miser at times to throw the cold water of reality on the great feelings of a never-ending upward capital asset market, the reality is they do not go in a straight line, ANYWHERE!

Axel and his team think that overall much of the markets have taken government intervention too casually along with the debt many countries have been accruing.

Have a plan for Crisis

On a very positive note, which we agree with, Axel and his team think that having a plan for crisis resolution helps resolve when the inevitable complacency turns to fear and overreaction.

While this may seem silly, it is not clear in many cases what the punishment will be and what penalty may ensue given certain world country actions. Just as my 5-year-old asks “So what happens if I do?” All parties need to know what lies ahead if they get out-of-bounds.

We hope you have enjoyed our review and next week we will wrap our event with a fun summary of our writings.

Have a Great Wednesday!

John Kvale