In this setting, asset prices may be vulnerable to significant declines should risk appetite fall." In particular, it highlighted some of the most bubbly areas of the financial markets: Initial public offerings, special purpose acquisition companies, and, yes, those meme stocks. Elevated equity issuance through SPACs also suggests a higher-than-typical appetite for risk among equity investor. This is about as close as the Fed can get to saying that certain asset prices are out of control. Of course, this hardly means the financial markets are wringing out the speculative excess.

Source: Mint May 09, 2021 18:00 UTC