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Hanser Alberto #2 of the Texas Rangers blows a large bubble as it bursts during MLB game action against the Toronto Blue Jays on May 4, 2016 at Rogers Centre in Toronto, Ontario, Canada.
The stars are aligning for the stock market, but not in the way bulls might like.There are four economic indicators that show remarkable similarities to 1999, the year before the dot com bubble burst and stocks were plunged into a bear market, says Brad McMillan, the chief investment officer of Commonwealth Financial Network in Waltham, Massachusetts, which oversees $114 billion.
While McMillan isn't making an exact prediction for the top of the stock market, he thinks investors should be increasingly conscious of how economic data is flashing warning signs.
"The tech industry is booming, unemployment is low, consumer and business confidence are high, and investors are very complacent," McMillan wrote in a blog post on Wednesday. "Now, 1999 was a good year, just as 2017 is shaping up to be a good year. With the wisdom of hindsight, though, we know that even as things were great, the seeds of the next downturn were already growing."
McMillan drew a similar parallel to 1999 in an interview with Business Insider last month. He called an equity bear market "quite possible" sometime in the next 12 to 24 months. "We could be headed for some stormy weather over the next couple years," he said. Read the full interview here.
Meanwhile, check out four charts McMillan says highlight the uncanny similarities between 1999 and present day: