Sridhar Vembu Warns: U.S. Stock Market in a “Massive Bubble” — Gold Offers Protection
Zoho founder and CEO Sridhar Vembu has raised serious concerns about the current state of the U.S. stock market, labeling it a “clear, massive bubble” reminiscent of the 2008–09 global financial crisis. His remarks echo those of economist Gita Gopinath, who recently cautioned that investors’ wealth is now more heavily tied to U.S. stocks than ever before. Gopinath warned that even a single market correction could trigger consequences worse than those seen after the dot-com crash.
A “Massive Bubble” in U.S. Stocks
In a post on X (formerly Twitter), Vembu agreed with Dr. Gopinath’s assessment, stating, “The U.S. stock market is in a clear and massive bubble.” He highlighted the high levels of borrowing and leverage in the financial markets, suggesting that these factors increase the risk of a systemic event similar to the 2008–09 financial crisis.
Gold as a Safe Haven
Turning to gold, Vembu expressed concerns that even this traditional safe-haven asset is signaling warning signs. He stated, “Gold is also flashing a big warning signal,” and emphasized that he views gold not as an investment but as “insurance against systemic financial risk.” He further noted, “Ultimately, finance is all about trust, and when debt levels reach this high, trust breaks down.
Market Snapshot
As of the latest data, the SPDR S&P 500 ETF Trust (SPY), which tracks the performance of the S&P 500 index, is trading at $664.39. Meanwhile, the SPDR Gold Shares ETF (GLD), which tracks the price of gold, is trading at $388.99.
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