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After the housing bubble and the Internet bubble before that, you'd think we'd learn our lesson. But maybe not.
According to Citigroup economist Steven Wieting health care is the next big bubble looming in the distance.And to make matters all the more worrisome, his analysis suggests it’s like nothing we’ve seen before.“It’s not a single asset price that’s about to pop (like housing) and it doesn’t have a cyclical component,” he explains during a live interview on Fast Money.
Rather, “It’s a fundamental bubble that will have a large impact on the economy.”Wieting says the trouble is spiraling health care costs that are growing at a fast and furious pace, a pace that will become all but impossible to support.
“Ultimately there will be a price to pay” he says.With the lion’s share of health care costs shouldered by companies and governments, he thinks the rising costs will ultimately hit budgets.“We’ll either have to raise taxes or increase budget deficits in order to finance it. And it will crowd out other things. Already we're starting to see it impact education and infrastructure spending."
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