SocGen's Edwards: Black Monday could happen again tomorrow

‘Extreme expense’ of equity valuations

Mike Sheen
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SocGen's Albert Edwards
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SocGen's Albert Edwards

Société Générale's bearish analyst Albert Edwards believes the events of the Black Monday crash in 1987 "could happen again tomorrow" as a result of inflated equity market valuations.

Edwards said he often hears clients saying they are "not interested in being told equity valuations are expensive", but noted that the "extreme expense of US equities" was a "major contributing factor" to the 1987 crash. Rogoff: Rising interest rates could cause economy to 'unravel' He said: "In my view the record 25% ‘Black Monday' 19 October decline was due to a horrendously expensive equity market suddenly confronted with the fear of recession. Equity valuations matter. "[19]87 saw a buoyant equity market rising briskly through most of the year as the oil price recovered from th...

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