It is commonly understood that a trigger of some sort is required for an economic crisis and a stock market crash to occur. Less understood however is that markets driven by credit expansions can collapse on their own weight.
By the looks of things, it is becoming increasingly clear that the U.S. economy is heading towards the point at which markets again will feel the burden of their own weight as bank credit growth has been slowing dramatically all year. For those looking for a trigger, it is this type of credit environment that breeds them (see link above). Consequently, the money supply growth rate is also plummeting, setting in motion the correction phase of the business cycle.
I have no idea what trigger will crab the headlines this time, but I'm pretty sure of this: a trigger will soon emerge and get the blame. That is the most important thing to be aware of in my opinion as the nature of the trigger is secondary.
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