Multi-billion dollar mergers are now commonplace. The US property market is starting to froth and the bell-hops are buying feverishly. Private debt in the US is high, increasing the danger of a downturn. The weight of money argument is again being trotted out. This money is coming from countless small US investors and Japan.
Speculation is near fever pitch in high technology stocks.
For example, the internet bookseller Amazon has seen its share price rise tenfold in a year even though it has yet to make a profit. The problem for soothsayers is that each investment cycle is unique. A downturn will come, we just do not know when. But as history shows - all it takes is one small trigger. In October 1987 it was a 0.25 per cent rise in interest rates that tipped the balance.