I have been stupid
I wrote about how bad our economy was on my graduation paper. I even gave a presentation about my writing in front of many educated people right before graduating from my University. My PowerPoint told the audience that recession is inevitable and coming soon in the clown show I held. However, look at the financial market. Everything is wonderful!
And who in the right mind would think that recession is incoming when every central bank in developed countries is willing to do whatever it takes to maintain the economy by implying that they will boost the financial market by printing money and so forth on a colossal scale.
People soon will start to believe that this bubble continues forever since central governments drive it, and they are in control in a good way! Humanity finally learnt how to prevent a recession entirely.
Let us utilise the power of mathematics
I am not, however, still able to dismiss the idea that what is happening in financial markets around the world is a bubble. Therefore, I analysed the prices of major companies and ETFs with Linear Regression.
 |
| Apple since 2000 to the current date |
 |
| Nikkei 225 since 2000 to the current date |
 |
| S&P500 since 2000 to the current date |
 |
| Toyota motor since 2000 to the current date |
If you start analysing since 2000, it indicates that it is in a bubble. However, if the financial crisis in 2008 was considered irregular and wanted to be ignored, then it should start in 2009, which was right after the crisis began to soothe itself. Let’s see it too.
 |
| Apple since 2009 to the current date |
 |
| Nikkei 225 since 2009 to the current date |
 |
| S&P500 since 2009 to the current date |
 |
| Toyota motor since 2009 to the current date |
It seems the price is slightly above the expected movement, but you cannot say it is in a bubble so that it might go up further.
About the pictures
I will implement this python code to a website so that everyone can freely generate analytic pictures like the above with any period, e.g. 2007 to 2009, and any stock prices. Please support me by reading articles on this site.
Thank you very much.