Source: Fortune
Summary
Economist Owen Lamont, who previously stated that the market was not in a bubble, is now sounding the alarm. He notes that the “Four Horsemen” of a bubble – overvaluation, bubble beliefs, equity issuance, and investor inflows – are now present. Lamont’s concerns are echoed by other experts, including JPMorgan CEO Jamie Dimon and Bridgewater Associates founder Ray Dalio. The market’s dispersion has reached levels not seen since the dot-com bubble, with some stocks experiencing extreme price moves. The options market is also betting on continued volatility.
Our Reading
The numbers tell one story. Lamont’s bubble-detection system is now flashing red. The dispersion readings for April and May 2026 are among the highest since 1995. Even before the dispersion data crystallized, Lamont was growing uneasy about the earnings story justifying valuations. The market’s volatility is being fueled by extreme price moves in stocks like Micron Technology and SK Hynix. The options market is betting on continued volatility, with the CBOE S&P 500 Dispersion Index near all-time highs. The whirlwind is upon us, and every market participant must confront it.
Author: Evan Null
