Sep 2, 2017

When the stock market stops soaring

AP/Peter Morgan

"Lights Out for Stocks: The bull's long gallop might be nearing an end," per Barron's cover story by Ben Levisohn:

What to watch for: "Neither longevity nor high stock prices, nor political turmoil usually are enough to send stocks into a protracted slide. The culprit in nearly every case is recession. The mystery is what will cause the next one."

Two possible triggers:

  1. "The S&P 500 is trading at 17.7 times 12-month forward estimated earnings, near the highest price/earnings ratio since the dot-com boom. ... [B]ear markets almost never begin when stocks are cheap.
  2. "At the same time, the Federal Reserve is normalizing interest rates. That, on its own, won't precipitate a bear market, but it could be a catalyst for one if the central bank hikes too much, too fast."

The takeaway: "Markets tumble all the time, but have a way of coming back, as long as the economy continues to grow."

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Minnesota activates National Guard amid fallout from George Floyd death

A portrait of George Floyd hangs on a street light pole in Minneapolis. Photo: Stephen Maturen/Getty Images

George Floyd, 46, moved to Minnesota to improve his life and become his "best self," but instead, he is dead because of Minneapolis police.

The latest: Minnesota Gov. Tim Walz declared a state of emergency and activated the state's National Guard in response to violent clashes over the past two days between police and protesters in the Twin Cities.

Trump signs executive order targeting protections for social media platforms

President Trump signed an executive order on Thursday designed to limit the legal protections that shield social media companies from liability for the content users post on their platforms.

What they're saying: "Currently, social media giants like Twitter receive an unprecedented liability shield based on the theory that they are a neutral platform, which they are not," Trump said in the Oval Office. "We are fed up with it. It is unfair, and it's been very unfair."