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http://www.independent.co.uk/voices...dustry-boom-and-bust-america-uk-a7734461.html

There's a probability that another recession could happen – but you won't hear politicians saying that

One of the lessons of the past decade is that governments have not abolished boom and bust. The moment they think they have, bam, along comes a biggie. For there seems to be an inevitable global economic cycle, with downturns coming through at seven or eight-year intervals for the developed countries. If that is right, we should be due one pretty soon.

While it is hard to see a global recession round the corner, there are certainly some disturbing features. One is the euphoria of the financial markets, with most major share markets at or close to their all-time highs. There is a potential for some sort of market crash.

Another, associated with share and house prices, is the dependence on very low interest rates to keep things moving. If interest rates were normal, and mortgage rates were, say, four per cent, what would that do to house prices? Cheaper homes would be wonderful in the long-run, but getting there would be disruptive. A lot of wealth would be destroyed.
Looking at America, I’m less concerned about house prices and more about the valuations of the high-tech sector. A handful of companies, most in technology, account for a disproportionate amount of the value of the top 500 firms, those in the S&P 500 index. To note that Apple is worth nearly $900bn on expectations for the new iPhone 8 is not to say that the shares will eventually plunge. It is simply there is a lot if value riding on one product.