Will It Be Different This Time? Part II: Current Financial Trends

Are we due for another collapse? The current investment landscape and how it affects financial professionals.

Hindsight is 20/20. Every financial bubble is accompanied by often extreme levels of behavior that, when looking back, seem like glaring red flags. We saw this in 2000 when investors were buying anything and everything that had “.com” after its company name or was somehow related to the proliferation of the internet. Prior to the 2008 financial crisis, anyone with a heartbeat could get a seven-figure mortgage without proof of income or assets, or any other now-required proof of financial stability. However, today, you don’t have to look far to see behavior patterns that suggest we could have another reckoning in the near future.

We are seeing the biases of overconfidence, herd mentality, and FOMO play out in multiple areas in the current investment landscape. Fast-growing trends like the influence of social media, the craze in cryptocurrency, and the hype around real estate show just how impactful these biases can be. (See Part 1: A Closer Look at Financial Bubbles.)

We are once again seeing signs of financial euphoria. Here are three trends to keep an eye on.

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_{Oppenheimer & Co. Inc. does not provide legal or tax advice, but will work with your other advisors to assure your needs are addressed. The opinions of the author expressed herein are subject to change without notice and do not necessarily reflect those of the Firm. Additional information is available upon request. Investors should review potential investments with their financial advisor for the appropriateness of that investment with their investment objectives, risk tolerances and financial circumstances.}