- War or revolution leading to a permanent loss of capital (think Confederate war bonds, or German panzers smashing through French lines on their way to Paris in 1940);
- An overly aggressive central bank tightening and tipping the economy into recession (you have got to be kidding me); or
- An economic recession.
Since the first two points are highly unlikely to cause a bear market in the near future, I will focus on the likelihood of a recession. My framework of analysis is examine the economies of the three major trade blocs in the world, namely the US, Europe and Greater China.
The full post is at our new website here.