The Bursting Of The Stock Market Bubble…Well Maybe

Back in July 2023, my firm, LCM Capital Management, wrote an article for Benzinga warning investors to stop paying attention to the market pundits aka "experts" and their predictions since they are wrong way more often than they are right.

Well, here we are again and the markets have had an unbelievable bullish run, as has gold (outside, of course, the one-week period in April) and now the "experts", very few if any having predicted this year's performance correctly, are now telling investors that we are in a bubble and it is going to burst and the markets are going to correct.

Jamie Dimon, the CEO of JP Morgan (JPM), recently issued a warning about a serious "potential correction." What's interesting is his firm as recently as September (literally 2 weeks ago) forecasted that the S&P 500 will reach 7000 by early 2026 which is almost 5% higher than where it is as of this writing (S&P 500 – 6671 close 10/15/25). What's interesting is their mid-year prediction on July 1^st was for the S&P 500 to close the year around 6000. So, in just a few months, they changed their tune, once again, and are now looking for a 16% appreciation in 6 or 7 months for the S&P 500. I wonder if Mr. Dimon knows this?  This is one of the great things about Wall St, the same firm can have differing opinions on the same subject; that way they can claim they were right all along. Mr. Dimon is the same man who referred to Bitcoin in 2017 as a "fraud" and said he would "fire any employee in a second" if he caught them trading in Bitcoin. Bitcoins price range that year was $900- $14,000. Then in 2021 he said Bitcoin would be "worthless." It traded that year between $29,000 and $67,000 closing out that year at $46,197. Clearly, he and his firm, changed their opinion on this sector, which of course everyone is allowed to do, but hopefully this should help to validate that all he and they are is doing, is guessing. Bitcoin today is over $100,000.

Goldman Sachs (GS) predicted back at the beginning of the year that the S&P 500 which was at 6211 would close the year at 6500, a 5% rate of return. In March, they cut their expectations to 6200, then in July they raised their target back to 6600 and as recently as September, they raised it to 6800. Is your head also spinning?

Bank of America (BAC) predicted the S&P 500 would close at 6666 which is in and of itself a skeptical prediction number but I digress. Then in April they lowered their target to 5600 for year-end. Then in July they raised it to 6300 and as you can well imagine, now that the S&P 500 has continued to climb, as of September, 7200 is their new price target. Still spinning or have you thrown up already?

This is just a small sampling of the craziness associated with my industry and their predictions. I recently heard an economist on Bloomberg News finally acknowledge, after she was called out to the mat on her predictions being wrong, something that my firm has been telling our clients for decades, namely, the world is so interconnected that it is factually impossible for anyone to accurately predict what is going to happen. How refreshing. 

Speaking of Bloomberg, back in August they ran a piece with the headline, The Big Correction. The article stated that some of Wall St's biggest firms are warning clients (aka scaring clients) to prepare for a major market pullback. Morgan Stanley, Deutsche Bank and Evercore were calling for a 10% – 15% correction in the 3rd quarter alone. Just as a reminder the S&P 500 was up 8% for the quarter.

Someone eventually will correctly guess this market's top but don't let that fool you into believing they know anything more than you or I, they don't. Wall St makes its living on getting investors to trade based on both fear and greed. This generates fees which benefit the firms.  But why does Wall St. exist? To benefit the firms or to benefit their clients?  These are questions which we at LCM believe every investor should be asking.

Below are a few quotes from other "experts" that you might have heard of:

Warren Buffett: "I never have an opinion on the market."

Peter Lynch: "I don't usually have an opinion (on the markets), I just buy good stocks and stay invested."

Sir John Templeton: "ignore fluctuation, don't try to outguess the market. Buy a quality portfolio and invest for the long-term"

Clearly this seems boring, but clearly it works, our clients can attest to that.

Benzinga Disclaimer: This article is from an unpaid external contributor. It does not represent Benzinga’s reporting and has not been edited for content or accuracy.