BofA Warns U.S. Policy Is Fueling a Bubble in Wall Street Prices
- Strategists note risk of taper tantrum, volatility events
- BofA forecasts a market correction in the first quarter
1 Wall Street near the New York Stock Exchange.
Photographer: Michael Nagle/BloombergThis article is for subscribers only.
Bank of America Corp. strategists warned the “extreme rally” on Wall Street that has pushed stocks to record highs, fueled by strong U.S. policy stimulus, is forming a bubble in asset prices.
“D.C.’s policy bubble is fueling Wall St’s asset price bubble,” strategists led by Michael Hartnett wrote in a note on Friday. “When those who want to stay rich start acting like those who want to get rich, it suggests a late-stage speculative blow-off.”