Donald Trump Warns a Stock Market Crash Is Coming

Donald TrumpDonald Trump is suggesting that overvalued tech stocks could cause another stock market crash...

In an interview with Reuters on May 18, Trump said that some tech companies are valued at billions of dollars -- but have never made any money.

"You have a stock market that is very strange," he said in the interview.

Trump suggested the stock market today could be in a situation like it was nine years ago (right before the stock market crash leading up to the Great Recession).

That was when the S&P 500 lost nearly 50% of its value and the Dow Jones Industrial Average fell 20% from its October high of 14,015.

tech bubble

Trump isn't the first billionaire to warn against overvalued tech companies...
Microsoft Corp. (Nasdaq: MSFT) co-founder Bill Gates and venture capitalist and entrepreneur Mark Cuban have criticized what they call unicorns - private companies with weak fundamentals valued at over $1 billion, according to GeekWire.

Cuban also cited another reason for a stock market crash: Trump himself. Cuban told CNN on Monday he thinks with "100% certainty" that Trump will cause a big correction in the markets.

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On the other hand, U.S. Federal Reserve Chair Janet Yellen emphasized that the U.S. economy isn't in a bubble back in April. Other economic and investment experts tend to agree, citing that stock prices, while high, aren't near the extremes of the dot-com bubble in 1997-2000, according to CNN Money.

Typically, it takes several factors at the same time for the stock market to enter a serious decline. For example, 9/11 was a major contributing event to the dot-com bubble.

Modernly, some of these factors could include: the economy falling into a recession, a Fed policy blunder, or a commodity price crisis, according to CNN Money.

A Foreboding Trump Isn't New

This isn't the first time Trump has predicted a stock market crash or a tech bubble this year.

On April 15, Trump said that a stock market crash "will be coming" and that we're also in a big bubble. He also said that the United States was on track for a huge recession, according to CNN Money.

And back in October 2015, the presumptive Republican nominee echoed the same fears of a stock market bubble to The Hill.

On May 12, Money Morning's D.R. Barton, a 28-year technical trader and celebrated financial coach, told FOX Business viewers how a Trump versus a Clinton presidency would affect markets. Here's that full segment:

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