It’s been nearly 100 years since the United States experienced its worst financial crash in the nation’s history. Financial journalist Andrew Ross Sorkin recently published a book, ‘1929: Inside the Greatest Crash in Wall Street History’, about that episode in America in which he examined the run-up to the crash and its aftermath.
Shortly before his book’s release, he sat down for an interview on 60 Minutes where he said that the U.S. is currently in another period of rapid financial growth similar to the “roaring ‘20s.” When asked directly about whether the U.S. is going to have another crash, he didn’t hesitate to respond, “we will have a crash.”
“This is either a gold rush or a sugar rush”
Sorkin has been covering financial markets for two decades and during that time he has earned the confidence of the world’s top business leaders. This has given him insights others don’t typically as he researched material for his book over the last 10 years, which came out in October.
While he isn’t sure if the U.S. is experiencing “some kind of remarkable boom,” or if “everything’s overpriced,” he said that he is anxious. “I’m anxious that we are at prices that may not feel sustainable,” he told 60 Minutes’ Lesley Stahl.
Most of the growth in market valuations is coming from artificial intelligence and technology. Sorkin contends that “the economy is being propped up, almost artificially, by the artificial intelligence boom.”
“This is either a gold rush or a sugar rush and we probably won’t know for a couple of years which one it is,” he explained.
Redux: roaring ‘20s 2.0
When asked if the U.S. is in another bubble like the 2000 internet bubble or 2008 in housing, he said, “I think it’s hard to say we’re not in a bubble of some sort.” He then added, “The question is always when is the bubble going to pop?”
“We will have a crash; I just can’t tell you when, and I can’t tell you how deep. But I can assure you, unfortunately, I wish I wasn’t saying this, we will have a crash,” he said bluntly.
One of his concerns is that the guardrails that were put into place after the 1929 crash are being removed. This is partly because ordinary Americans feel that the rules protecting them, are in reality depriving them of getting rich like the elites.
One area of investment that harks back to the abuses of the roaring ‘20s for him is cryptocurrency. In particular meme coins. These can be manipulated with pump and dump schemes by speculators who hype them to push up the price and then let them crash.
The party could end with a snap of a finger
Although Sorkin doesn’t see the U.S. economy going off a cliff tomorrow, he’s worried “that there’s speculation in the market today, there’s an increasing amount of debt in the market today, and all of that’s happening against the backdrop of the guardrails coming off.”
“I think it’s hard to know how things get out of control. When confidence disappears, it happens like this,” Sorkin said snapping his fingers.
Related stories
Get your game on! Whether you’re into NFL touchdowns, NBA buzzer-beaters, world-class soccer goals, or MLB home runs, our app has it all.
Dive into live coverage, expert insights, breaking news, exclusive videos, and more – plus, stay updated on the latest in current affairs and entertainment. Download now for all-access coverage, right at your fingertips – anytime, anywhere.