Is this a new 1929? Cracks in a market that keeps falling but never falls

Is this a new 1929? Cracks in a market that keeps falling but never falls

Last Thursday, as the Nasdaq hit a new all-time high, an investor commented in a private circle that he had just sold all his tech stocks. "It reminds me of the Groucho Marx anecdote about the shoeshine boy who was also investing in Wall Street before the crash," he wrote. The market was rising, but he was out. And he shared a figure he had heard from an economist: the upcoming wave of massive IPOs will drain flows from other stocks, accelerating a broad correction. He was not the only one smelling smoke.

The printer and global debt: two anchors that change everything

Some argue that comparisons with 1929 are a mental trap. Today's money creation has no parallel: money printing is brutal compared with the 1920s. This has created an asset inflation that, for some analysts, is not a bubble — it is a permanent devaluation of money that shows up in the indexes. The S&P 500 may look expensive by the Shiller PE, but measured on the trailing PE it is nowhere near 1929 levels. What's more, debt is global, the dollar is global, and the interconnection is total. "There is nowhere to run, and no one wants it to blow up. All that's left is to print and pray," one fund manager summed up. That is the core argument of those who believe the cycle is somewhat sustainable.

Tech euphoria and the bearish consensus

But on the other side of the ring, skepticism is growing. The rallies in semiconductors and memory seem never-ending, and more and more retail investors are piling into stocks and crypto. "Everyone is invested — even the garbage collector knows about the stock market," one participant complained. The feeling that this is a trap is spreading. "Every 8-10 years the market needs a crash. Exponential gains are impossible to sustain; infinite growth does not exist," argues the most mathematical approach. The expectation is that, somewhere between summer 2026 and late 2027, there will first be a maximum frenzy of gains and then an unexpected hammer blow.

The striking figure: the gap with real Spain

Amid the debate, one figure about the investor profile in Spain stands out: nine out of ten adults would not touch an investment fund even at gunpoint. Most young people do not even save. Index investing is the domain of a very specific profile aged 30 to 45. In other words, the bubble, if it exists, is not in the small Spanish investor. Meanwhile, those who are in the market — especially abroad — watch YouTube videos predicting crashes multiply by the day. And as everyone knows: the more media outlets predict a crash, the more certain it is that it has not peine yet. Or maybe it has. After all, the system has been inflated since 2020 and the big bang still has not arrived.

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