Is Everything a Bubble? Why That’s the Wrong Question

Published on
February 8th, 2021
21 minutes


Is Everything a Bubble? Why That’s the Wrong Question

The Expert View ·
Featuring Raoul Pal

Published on: February 8th, 2021 • Duration: 21 minutes

Raoul Pal, CEO and co-founder of Real Vision, kicks off a two-week content campaign exploring the question, “Is everything a bubble?” He highlights the conflicting evidence that, on one hand, is pointing toward bubbles all around us and, on the other hand, pointing toward secular and reflexive trend shifts that can go on longer than anyone imagined. For this reason, Raoul worries that simply answering yes or no to the bubble question isn’t the best way forward and challenges viewers to check their biases at the door and be open to the idea that what looks like a bubble can be a paradigm shift, that bubbles may be present in today’s market but can be a source of incredible returns, and that the market is full of anti-bubble opportunities for those looking to opt out of the perceived madness. He cites examples of assets like bonds and crypto that some feel are a bubble but he believes are still great investments as well as reflation trade equities that he believes to be in a bubble, both from a narrative and price perspective (in spite of the overwhelming affinity markets exhibit toward this trade), and opportunities like emerging markets and commodities that are closer to anti-bubble territory. Filmed on February 3, 2021.



  • RG
    Raoul G.
    15 February 2021 @ 05:51
    This entire video sounds like waffling
    • TS
      Tom S.
      16 February 2021 @ 05:09
      It was.
  • MB
    Marc B.
    9 February 2021 @ 02:00
    Raoul, this is what a dollar crash looks like. The real bubble is the dollar, and price in dollars can go up forever.
    • VK
      Viresh K.
      14 February 2021 @ 18:59
      Get off ZeroHedge Marc
  • RR
    Rufus R.
    12 February 2021 @ 19:00
    If investment is a relative game, then the statement 'everything is a bubble' can not be true.
    • VK
      Viresh K.
      14 February 2021 @ 18:46
  • DC
    Don C.
    11 February 2021 @ 08:54
    Although the main narrative was: labelling things as bubbles/not bubbles doesn't help, things are shades of grey, all comments ponder on: what is a bubble and what not? Instead of assigning a label that has a different meaning to different people, let's make the effort to define specific characteristics which helps the quality of our decision making. This holds true in every aspect of life. When we accept being uncertain, we are more likely to researched both ends of a spectrum. As soon as we assign binary labels, we move towards confirmation what we already think. As long as you present more questions than answers, I'll happily include your opinion in the biased echo chamber of my own mind!
  • RL
    Raul L.
    11 February 2021 @ 03:17
    It can't be a bubble. Rather, all the ships are pointing to the same direction. Crypto = future !
  • WS
    William S.
    8 February 2021 @ 23:38
    End of the Day - the "market," the "machine" etc is 99% emotion -- bubbles are a look back game of coulda shoulda. Set your thesis - execute - evaluate based on your level of risk which is largely a function of your basis --- when did you "get in" on the trade or trend -- all based on your duration. Too many q's -- more interested in reasonable 30k ft anaqlysis from a macro viewpoint. Inside that you get caught up in all the so called facets of investing...
    • LS
      Lemony S.
      10 February 2021 @ 21:49
      Good points.
  • NI
    Nate I.
    9 February 2021 @ 02:24
    I remember the same conversations in 1999 about how it was different this time. Valuations didn't matter because the Internet was going to change the world.. yada, yada. A PE of 200 on Cisco was ok because every car, boat, plane, house and woodshed would need routers. The Internet changed the world, but low and behold valuations still mattered. There is one thing different this time. Unlike 1999 when REITs were the bargain of the century and it was an easy rotation from high flying tech stocks to bargain basement REITs, this time there is nowhere to run except to gold.
    • MM
      Martin M.
      9 February 2021 @ 04:53
      Started to comment, but, Nate, you took the words right off my keyboard!
    • LS
      Lemony S.
      10 February 2021 @ 21:48
      except to BTC, you mean.
  • CW
    Chris W.
    9 February 2021 @ 23:48
    What happens when people are really in control of their own assets? With decentralized finance the owner can use their assets as collateral and get the benefits themselves. At the moment it's only possible with crypto assets but once shares are tokenised everyone will be able to control how theirs are leant out or not. WSB telling everyone to tell their brokers to not allow their GME shares to be lent out was the aha moment for many. How will that affect the finance system of brokers and dealers? What will or will no longer be possible for hedge funds and co? What will the second order effects of that be?
    • LS
      Lemony S.
      10 February 2021 @ 21:46
      People talk about the service economy an awful lot, and how a country can't last with such a schema. They forget that "financial services" has been a bigger part of the "service" problem. What we are seeing now is the end stage of the over emphasis of financialization of the economy, where we incented talented people to become part of the system that just allowed massive transfers of wealth to them ... instead of actually producing things.
  • DL
    David L.
    10 February 2021 @ 05:38
    There's a bubble in the characterization of assets as being in bubbles.
    • LS
      Lemony S.
      10 February 2021 @ 21:41
      I chuckled, yes, good stuff.
  • NC
    Nelson C.
    10 February 2021 @ 19:00
    I like Real Vision, it tells the hidden truth about what is happening in our world today. Thanks
  • CC
    C C.
    10 February 2021 @ 16:44
    Love the openness, honesty, and humility of “I don’t know.” Three of my favorite words in that they help clear the mind, extend vision, and enhance the ability to listen. Thank you for this. I look forward to this series.
  • JS
    John S.
    8 February 2021 @ 09:51
    Bring Cathie Wood and ask her if all is a bubble. ;)
    • KL
      Kerrie L.
      9 February 2021 @ 01:17
      I watched her most recent video and she says there is no bubble. However, she did recently state that she expects a major correction this year in equities.
    • AB
      Alastair B.
      9 February 2021 @ 03:46
      Increasing correlation between crypto and equities as companies FOMO in to bitcoin is going to be the crash driver. We know BTC is going to go down 80% and stay there for 2.5 years. The trick is, knowing when. The only difference this time is it’s bringing TSLA with it
    • AP
      Alfonso P.
      10 February 2021 @ 13:37
      We are in an information/presentations/content bubble, that is where we are right now !
  • SC
    Stefan C.
    10 February 2021 @ 08:39
    Hi Raoul I might just get shot for this one but here it is. The risk of event on dollar is preparing the dollar to strengthen, the liquidity pool had been dipped in twice from the weekly perspective, dollar strength from today/tomorrow and will go to first terminal at 93.215, second terminal, 99.305..............might eventually pick up passengers at 114.545.(Shocked me as well, that area has tremendous interest) Narrative : Dollar to strengthen, Gold to dip into 1575, EURUSD to 1.18200 sliding to 1.10627, Brent is actually will touch into 61.84 and will slide to 38.21. BTC will have a correction which might be nearer than expected. Situation will that the emerging markets will struggle and continue to struggle. Note this is in play now. Very against the crowd sentiments as everything I see is a bearish dollar. I really don't think so. Hard pill to swallow, check out these levels on a chart. Thank you kindly for information on this site, I helps me tremendously. If all works you welcome to contact me, my email is
  • DF
    David F.
    10 February 2021 @ 07:13
    Wondering about @BenLilly on HackerNoon and his article on Grayscale and what they were doing behind the scenes... See: "Grayscale's (GBTC) Pump Effect Means 2021 Will Start Slow" Here is the link -> Thoughts?
  • WD
    Wyatt D.
    10 February 2021 @ 03:48
    This feels like CYA (i.e. somewhat disingenuous) just a week after floating the idea of OTM TLT calls because of Gamestop. I love much of the content that RV has provided, but the world is on an accelerated timeline and many of us no longer have the luxury of watching hours of video to separate the wheat from the chaff. Posturing as an oracle and then subsequently posturing as a know-nothing comes across as rather aggravating to the viewer. No one is oracle--posture as such.
    • ll
      luci l.
      10 February 2021 @ 06:49
      yah, the TLT calls hurt
  • DK
    Danny K.
    10 February 2021 @ 06:44
    Cheers.. I don't understand how you can give somebody shit when they say 'I don't have all the answers'. It's an unforgiving world ha.
  • JH
    Jeffrey H.
    10 February 2021 @ 00:12
    Buy Theta Token!
    • ll
      luci l.
      10 February 2021 @ 06:41
      agreed! and beautiful working system for video and more
  • TK
    Teodor K.
    10 February 2021 @ 04:34
  • DP
    David P.
    10 February 2021 @ 04:16
    I'm seeing two things: 1) The US Dollar is down, not so much from the FED Printing Press (as it's results are largely locked up in bank reserve funds, but because the US Economy has been damaged by its very poor handling of the COVID crisis during 2019, when compared to Europe and, especially East Asia. If their economy are able to produce largely unhindered by the pandemic - and the US is not - the US currency takes it on the chin, But we're only talking about 5% to a maximum of 10% change in relative value - hardly a bubble. The other item is the 0% interest rates in the US. We're not built for that, especially in our equity markets. To grossly over-simplify it stock prices can be viewed as earnings divided by the interest rate of your capital. If that's zero, then the whole security price evaluation model breaks down and the only provable figure you can base valuation results on is growth. Ending up with not a rational pricing regime, but a cancer that metastases through our the economy. I think that one of the tools that is either not discussed, or maybe doesn't exist is a measurement for 'V' the velocity of money in our society. This is what will determine the lasting effect of what the FED has done in the last year. Also, we've not had any discussion on how the FED could start to unwind these actions as our economy starts booming again - well beyond "Rocks fall, everybody dies." It's almost as if a segment of our audience WANTS the world financial system to collapse so that an imagined utopia of inherently deflationary crypto currencies can bring wealth to the masses.
  • DA
    Duarte A.
    10 February 2021 @ 02:37
    For the amount of money that's being printed, I'm not sure if we're in bubble territory... Either way, where is the money supposed to go? With the world at home, consumption is low, nobody's traveling anywhere for holidays, real estate markets in the largest urban areas kind of deflating, it'll be hard to find a better place to put anyone's money than in the stock market... Also, if you do need the money, will you take profits, or make a cheap loan using stocks as collateral? The FED has also contributed to change the mindset of the investor, by assuming many of the downside risks, (this is almost the same as keep playing poker when everybody saw your hand, you cannot come back from that)... I believe that what we should be asking is, "what will trigger anyone to take profits from this market?"... The FEd will tapper any major economic signal, the CPI calculation method is pathetic (we'll feel inflation way before any significant CPI increase), new covid strains seem to be disregarded, stock market dips are bought immediately, whatever the news... People will take this until a better proposition arises... Probably when they realize that the stock market gains are not enough to keep up with higher and higher costs of living... This will most likely end badly... but as Mike Green said "This Car Has No Brakes, But We're Driving Uphill"....
  • MO
    Master O.
    8 February 2021 @ 07:10
    "History teaches us that there are always paradigms and paradigm shifts and that understanding and positioning oneself for them is essential for one’s well-being as an investor and beyond. Consensus views in the markets always suffer from recency bias. It tends to assume that the paradigms that have existed will persist and it fails to anticipate the paradigm shifts, which is why we have such big market and economic shifts. These shifts, more often than not, lead to markets and economies behaving more opposite than similar to how they behaved in the prior paradigm." - Ray Dalio
    • DS
      David S.
      8 February 2021 @ 22:50
      The shift in understanding here is to say that we are in a $US dollar bubble. We shift from focus on NPV to the bubble in the $US. DLS
    • DB
      D B.
      10 February 2021 @ 00:30
      Fiat currencies with printing to infinity can't be a good thing if we need production and innovation. Please bring Michael Saylor and/or Ross Steves on as future guests when/if you look at the dollar.
  • sd
    steve d.
    9 February 2021 @ 21:45
    The sound is slightly out of sync. Otherwise looking forward to the content
    • AT
      Alun T.
      9 February 2021 @ 23:17
      It's a bloke sitting in a seat talking at a camera. Does it matter?....just saying
  • mk
    michael k.
    9 February 2021 @ 22:42
    It is good to know I'm not alone.
  • FH
    Frederic H.
    9 February 2021 @ 06:48
    The man invested only in bit & eth & a basket of alts is "terrified" of the U.S. stock market? Make that, mildly concerned.
    • sc
      sung c.
      9 February 2021 @ 21:07
      Choosing one asset does not mean other assets don't have merit, but rather that the others have less merit for the time being. There are numerous stocks I sold at profit and poured into BTC, but those other ones still went up, just not as much. One must decide where to concentrate their purchasing power based on their beliefs. If they don't have a strong belief and/or understanding, then they should diversify.
  • FL
    Fabrizio L.
    9 February 2021 @ 20:37
    Raul talk to us about margin credit please
  • VS
    Ville S.
    9 February 2021 @ 17:28
    What's wrong with the audio?
  • RC
    Robert C.
    9 February 2021 @ 03:02
    We are not in a bubble. When I go out looking to buy a car I look to pay the most I can for the model I am interested in. Or when I did go out to dinner I wanted to find the most expensive restaurant, because they have the best food right? I don't mind at all spending $90K on some sports card of the latest greatest sports hero because that's what it cost and someone will always pay me more for it. It is not a mania it is just a rational investment well because the value of money is going to hell. I am only paying more for stuff because I know for sure somebody is gonna pay me more for it later on. Heck paying sports guys $30 to $40 million a year is getting to be the norm. Even the commissioner of the NFL makes like $50 million a year and takes no real hits. Yah I think extreme is getting close to the right word. Keeping a short leash or your investments is probably a good idea. At some point we are going to realize collectively prices have gotten out of hand and we can't walk into a grocery store with a bar of gold and expect the right change back.
    • rm
      ryan m.
      9 February 2021 @ 16:20
      You know for sure somebody is gonna pay you more later on? You are describing the greater fool theory. I don't know many markets that were built on the greater fool theory that didn't crash
  • DO
    DIOGO O.
    9 February 2021 @ 09:58
    Raoul, please bring Peter Brandt and Robbin Griffiths! Cheers!! #BTC OBS: what about someone that also talks about the Crypto companies available in the public markets? Like Galaxy Digital an so on....
  • JV
    J V.
    9 February 2021 @ 00:29
    Please interview Doug Noland. he's been writing the credit bubble bulletin for years if not decades
    • PB
      PHILLIP B.
      9 February 2021 @ 01:46
      OMG. +100 Yes, for decades if not years.
    • FH
      Frederic H.
      9 February 2021 @ 06:43
      Noland is the John Hussman of credit. They live in the same snow house at the North Pole.
  • DM
    Dominic M.
    9 February 2021 @ 02:07
    Mohamad El-Erain called the present situation a "logical bubble" today. A bubble given valuations, but logical because of liquidity.
  • JM
    Justin M.
    9 February 2021 @ 01:58
    Raoul is smiling so much in the video thumbnail because of how much his bitcoin moved up today.
  • DA
    Dominique A.
    9 February 2021 @ 00:08
    You should invest in a better microphone.
    • NL
      Nikola L.
      9 February 2021 @ 00:19
      he is 100% in BTC. 😁
    • PB
      PHILLIP B.
      9 February 2021 @ 01:47
      Maybe it's the playback devices, the speakers?
  • WS
    William S.
    8 February 2021 @ 23:40
    What is an "anti-bubble?"
    • JA
      John A.
      9 February 2021 @ 00:24
      Read Diego Parrilla book. Explains it well. Think he did a RV interview.
    • JV
      J V.
      9 February 2021 @ 00:27
      I'm guessing it's a reference to Diego Parilla's work on that topic, and book by that name
  • WS
    William S.
    8 February 2021 @ 23:52
    The "party" will slow from a rate of change GDP/Inflation viewpoint in the the 3rd/4th qtr and the mkt/machine(emotions) will react accordingly a correction is being predicted - when/trigger who knows -even though the economy will still be ramping just not as fast and the "emotions" will react...steady state is a long way noted commodities (assumes a $$ decline) and EM(more $$$ centric) will play out over the next 1-5 yrs... why the peculiar range because that's the range of "consensus."
  • AT
    ADAM T.
    8 February 2021 @ 18:55
    Raol, besides Bitcoin and Ethereum have you been looking at any infrastructure plays in the crypto?
    • JS
      John S.
      8 February 2021 @ 21:58
      I am not Raoul but I have today bought litecoin. However only because it is cheap and none knows where all can go. This is not investment advice.
    • WS
      William S.
      8 February 2021 @ 23:44
      Go look at Arca digital assets fund and their CIO - there is I believe 1-2 RV interviews w/ him last few months -- or sign up for the numerous newsletters - Coindesk comes to mind. There is a tone of stuff going but analyzing it is mind boggling.
  • WS
    William S.
    8 February 2021 @ 23:41
    Would much prefer the do's don'ts of those who have been in the depths of a thesis and how they managed the emotions along the roller coaster...
  • DS
    David S.
    8 February 2021 @ 22:51
    It looks like money is flooding into China for higher bond yields. This makes the China’s current account look a lot better in the FX market. Higher Chinese public and private bond yields, however, come with the additional risk currency controls. Size accordingly and careful with leverage. DLS
  • MS
    Mark S.
    8 February 2021 @ 22:17
    Maybe in light of unprecedented printing, the question’Is there a bubble?’ Is the bubble, at least until the printed money finds a home.
  • UU
    Ulrich U.
    8 February 2021 @ 20:10
    In my view there are some micro bubbles (e.g. some sovereign bonds and non-profitable growth companies). However, risk positioning overall is not very stretched. CTAs, Risk Parity and Vol Targeting are still only moderately invested in equities. CFTC positioning of non-commercial traders in equities is also low. Put-Call Ratios on Indices are above the Long-Term Average, indicating hedging demand and no complacency. Betas of Multi Asset Funds are also muted. Cash quotas of most funds are also not very low - at least to my knowledge as I interview some fund managers. There is still a lot of dry powder in US money market funds. Overall, I remain bullish for the time being. If the VIX drops markedly below 20 and systematic strategies are more exposed to equities again (as in Jan 2018 and 2020) I will become more cautious again. Maybe in March... The last big crashes have all happen at the end of a quarter.
  • DB
    David B.
    8 February 2021 @ 20:10
    The main thing that the “gurus” miss / don’t emphasis enough is interest Rates for bank savings accounts. I’m now constantly having people talking to me who a couple of years ago didn’t even know what the stock market is .. are now fed up with what banks are giving them as a return (yield) and are wanting to get into stocks / crypto.
  • MF
    Matt F.
    8 February 2021 @ 19:02
    get Dan Dreyfus on to talk commodities.
  • GF
    Gordon F.
    8 February 2021 @ 17:19
    Rather than asking if we are in a bubble, I prefer to ask how fragile the various systems are, and how a failure in one system might domino through others. My personal perspective is that fragility is high and increasing in multiple areas, and that the frantic efforts by central bankers and others to keep things from breaking are just increasing the fragility. Where will it break? I have no idea, nor can I foresee how things will echo through the others. I look forward to these discussions in the hope that I may gain further insights.
    • LM
      Laura M.
      8 February 2021 @ 18:51
      Completely agree. Figuring out fragility and contagion (and what areas are relatively safe from those) is THE order of the day.
  • AM
    Alonso M.
    8 February 2021 @ 17:43
    Druckenmiller says this is the wildest market he's ever seen. Rosenberg says he hasn't seen anything like this in his 35 years of following financial markets. Grantham says we are in the late innings of a massive bubble. These three come at it in very different ways, and all three are now being ridiculed to some extent which I assume is a prerequisite for the reversal of today's irrational exuberance.
  • GP
    Geoff P.
    8 February 2021 @ 15:45
    I think it's much more simple than most realize. There is an infinite amount of capital (so long as CBs and treasuries keep the illusion of credibility) chasing a finite amount of assets. It's really that simple. Losses end up on central bank balance sheets in the form of stupidly mispriced government debt (remember, at market rates all the bonds on CB balance sheets would show unfathomable losses). So for every loss in the system (economic or market) that loss creates a dollar of investible capital via the CB (and now it seems we're adding on to that with fiscal, again mopped up by the CBs). That capital then is free to chase various pie in the sky dreams without fear of loss. There is no business too foolhardy to dissuade funding. As the losses mount, more capital is created again chasing the same things.
  • DH
    Daniel H.
    8 February 2021 @ 15:15
    Thanks RV for this timely series.
  • df
    diamantino f.
    8 February 2021 @ 09:26