Structural issues reminiscent of the lead up to the infamous Wall Street crash of 1929 are once again at play, according to investment advisor Paul Gambles of MBMG Group.
"There are a lot of real structural issues, once-in-a-lifestyle 1920s-style structural issues that are threatening to come home to roost," Gambles told CNBC Wednesday.
While acknowledging that he has not had a bullish outlook since late 2011, the Asia-based strategist highlighted that he believed the disconnect between reality and market pricing had now moved beyond levels ever seen during his lifetime.
"Now is the time that we are genuinely getting worried that these things are likely to start to have an impact," he added.
Gambles warned of the dangers of taking too short-term a look in the rearview mirror with market participants often focusing their comparisons on six-monthly or year-long periods. This despite the long-term trends being, according to the MBMG managing director, "very, very negative" and representative of a "dead cat bounce that's got out of control".
"The dead cat is somewhere stratospheric now and it probably shouldn't be because it's getting totally, totally disconnected from a lot of real, underlying fundamental realities," Gambles posited before turning to recent events and consequent market movements.
Market writing 'blank checks'
The S&P 500 index has rallied by around 11 percent in the mere three-and-a-half months since Donald Trump was elected as U.S. president, a rally believed to be largely driven by expectations that he will deliver on pledges to cut corporate taxes and boost fiscal spending programs.
According to Gambles, this is an optimistic read of what lies ahead.
"Markets are pricing that the reflation trade is going to work, they're pricing the Trump trade into reality and we see a lot of headwinds coming up for that," he said, adding that he expected the pressures to start hitting equities in the second half of the year rather than in the coming months.
"A lot of the blank checks that the market is writing are not going to be cashed, that growth is not going to come through," he opined.