Peak Prosperity Creak! Pop! More Signs That the Everything Bubble Is Getting Ready to Burst
Nov 21, 2025
In this discussion, wealth manager Paul Kiker shares insights on the looming financial crisis driven by market bubbles. He highlights early signs of housing market weakness and the troubling rise of insurance costs in Florida. The duo critiques the hype surrounding AI investments, pointing out the risks of corporate debt and unclear revenue paths. Kiker also warns about extreme margin debt and its potential to exaggerate market declines, emphasizing the importance of cash flow and preparing for economic corrections.
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U.S. Housing Cooled Sharply
- Over half of U.S. homes saw falling Zestimates in the last year, signaling broad cooling in housing.
- Paul Kiker and Chris Martenson expect this trend to accelerate as many sellers refuse to cut prices.
Insurers' Private Credit Concentration
- U.S. insurers now hold about 35% of investments in private credit, concentrating exposure to risky, opaque assets.
- That allocation helps explain recent spikes in insurance costs and insurer vulnerability.
Pro's Tale: Insurers Bid Recklessly
- Ken McElroy reviewed 600 deals and only did one because insurers were bidding at unsustainably low cap rates.
- He called that buyer behavior "dumb money" and refused to chase 3% cap deals.