London Daily

Focus on the big picture.
Thursday, Jul 10, 2025

There’s a ‘mania’ in stocks, but investors face an even greater danger, warns Nobel Prize-winning economist

There’s a ‘mania’ in stocks, but investors face an even greater danger, warns Nobel Prize-winning economist

Paul Krugman says the “fear of missing out” is driving this market ever higher, even though the risks continue to mount.
That’s Nobel Prize-winning economist Paul Krugman explaining to CNBC why the “fear of missing out” is driving this market ever higher, even though the risks continue to mount.

Indeed, the S&P 500 SPX, -0.64%, shrugging off the rising number of U.S. coronavirus cases, has benefited from a sturdy run in technology stocks to a gain of more than 6% over the past month.

“[Tech stocks] are riding on the prospects of economic recovery in Asia and Europe even as the U.S. completely mucks things up,” Krugman said, adding that many retail investors have been drawn into the equity markets due to a lack of alternatives, such as the historically low-yielding bond market.

While many pundits are quick to blame the Federal Reserve for inflated stocks, Krugman told CNBC that he doesn’t see how the central bank had much of a choice.

“They could not have stood by and allowed a financial crisis on top of the viral crisis, so this is what had to happen,” he said. “And if there’s some mania in the markets, well that’s what happens.”

The way things stand now, the national debt isn’t much of a concern for Krugman, who said a big infrastructure program is a “no-brainer” for policymakers. “At this point with everything else going on, the great danger is that we spend too little, not too much,” he said.
Comments

Oh ya 5 year ago
The US government is the main driver of the market . They are now buying junk bonds trying to keep this going until maube after the election or maybe until it just explodes. They are dumping 9 billion a day. This will end in tears

Newsletter

Related Articles

0:00
0:00
Close
Severe Heatwave Claims 2,300 Lives Across Europe
NVIDIA Achieves Historic Milestone as First Company Valued at $4 Trillion
Declining Beer Consumption Signals Cultural Shift in Germany
Linda Yaccarino Steps Down as CEO of X After Two Years
US Imposes New Tariffs on Brazilian Exports Amid Political Tensions
Azerbaijan and Armenia are on the brink of a historic peace deal.
Emails Leaked: How Passenger Luggage Became a Side Income for Airport Workers
Polish MEP: “Dear Leftists - China is laughing at you, Russia is laughing, India is laughing”
BRICS Expands Membership with Indonesia and Ten New Partner Countries
Weinstein Victim’s Lawyer Says MeToo Movement Still Strong
U.S. Enacts Sweeping Tax and Spending Legislation Amid Trade Policy Shifts
Football Mourns as Diogo Jota and Brother André Silva Laid to Rest in Portugal
Labour Expected to Withdraw Support for Special Needs Funding Model
Leaked Audio Reveals Tory Aide Defending DEI Record
Elon Musk Founds a Party Following a Poll on X: "You Wanted It – You Got It!"
London Stock Exchange Faces Historic Low in Initial Public Offerings
A new online platform has emerged in the United Kingdom, specifically targeting Muslim men seeking virgin brides
Trump Celebrates Independence Day with B-2 Flyover and Signs Controversial Legislation
Boris Johnson Urges Conservatives to Ignore Farage
SNP Ordered to Update Single-Sex Space Guidance Within Days
Starmer Set to Reject Calls for Wealth Taxes
Stolen Century-Old Rolls-Royce Recovered After Hotel Theft
Macron Presses Starmer to Recognise Palestinian State
Labour Delayed Palestine Action Ban Over Riot Concerns
Swinney’s Tax Comments ‘Offensive to Scots’, Say Tories
High Street Retailers to Enforce Bans on Serial Shoplifters
Music Banned by Henry VIII to Be Performed After 500 Years
Steve Coogan Says Working Class Is Being ‘Ethnically Cleansed’
Home Office Admits Uncertainty Over Visa Overstayer Numbers
JD Vance Questions Mandelson Over Reform Party’s Rising Popularity
Macron to Receive Windsor Carriage Ride in Royal Gesture
Labour Accused of ‘Hammering’ Scots During First Year in Power
BBC Head of Music Stood Down Amid Bob Vylan Controversy
Corbyn Eyes Hard-Left Challenge to Starmer’s Leadership
London Tube Trains Suspended After Major Fire Erupts Nearby
Richard Kemp: I Felt Safer in Israel Under Attack Than in the UK
Cyclist Says Police Cited Human Rights Act for Riding No-Handed
China’s Central Bank Consults European Peers on Low-Rate Strategies
AI Raises Alarms Over Long-Term Job Security
Saudi Arabia Maintains Ties with Iran Despite Israel Conflict
Musk Battles to Protect Tesla Amid Trump Policy Threats
Air France-KLM Acquires Majority Stake in Scandinavian Airlines
UK Educators Sound Alarm on Declining Child Literacy
Shein Fined €40 Million in France Over Misleading Discounts
Brazil’s Lula Visits Kirchner During Argentina House Arrest
Trump Scores Legislative Win as House Passes Tax Reform Bill
Keir Starmer Faces Criticism After Rocky First Year in Power
DJI Launches Heavy-Duty Coaxial Quadcopter with 80 kg Lift Capacity
U.S. Senate Approves Major Legislation Dubbed the 'Big Beautiful Bill'
Largest Healthcare Fraud Takedown in U.S. History Announced by DOJ
×