What will trigger the next market crash?
1. 1. Recent history. “Stock markets are on a vintage tear. Entering yesterday (6th October 2017), and with the tenth anniversary of the S&P’s pre-crisis peak to come on Monday (9th October 2017), the main US index set its sixth successive all-time high. The last time it enjoyed such a streak was two decades ago.” 
2. What causes crashes? There are three classical triggers:
a. The cyclical one occurs when markets reach cyclical peaks and then crash;
3. Testing the above, our view is simple: the only “fly in the ointment” is a random event.
a. Cyclical. The Economic Clock® is ticking along nicely. Currently, the global economy is enjoying that golden Economic Time®
i. excess supply of money – aka global quantitative easing -
iii. This golden Economic Time® is set to continue on account of structural factors which you all know about:
iv. Globalisation has weakened the power of unions to spark wage-push “Phillips-curve-style” inflation cycles;
v. Technology has had the same effect,
1. Financial avarice. Indeed, one major cause of today’s financial avarice is, which went out the window decades ago. This single event led credence to what is on America’s money: “In God we trust” – implying
b. Valuation. High valuations never “cause” crashes; instead, they are used in 20-20 hindsight by disingenuous analysts when justifying why they screwed-up in the first place by not anticipating a crash. As some solace, however, to those believing that high valuations do cause crashes: turn to chart four of this week’s “The bull market in everything” Economist, p. 21: America’s cyclically-adjusted PE ratio, or CAPE, is 1/3 below its all-time peak back in early 2000.
c. Random. Here is the snag. In blogs past, I have suggested that unforeseen brush fires in the following well could lead to another 2007/8 financial crisis:
You all know about these three areas, so it is tedious to recapitulate your knowledge.
4. Action plan. Instead of us trying to predict when one of these three black swans will hit the windshield, just keep an eye on these yourselves when reading
 Yes, we all know that quantitative tightening is on the way, but I, for one, don’t think that it will make much of a dent in that excess supply of money sloshing about, ”excess” to sluggish global growth prospects. It cannot be in central banks’ interest to hike rates to such a degree that crashes occur. After all, it is the central banks that will be