Lead strategist at Goldman says stocks exhibit signs similar to 2008 crisis

One of Wall Street’s most closely watched stock strategists is sounding the alarm: The stock market is exhibiting some of the same dangerous characteristics it exhibited in the run-up to the 2008 Global Financial Crisis, and a correction could be at hand. And the warnings from Peter Oppenheimer, chief global equity strategist at Goldman Sachs, carry special weight — because his contrarian bets have a solid track record of success.

In a research note published Wednesday, Oppenheimer warned that equity risk premiums — a measure of how much extra return investors require for owning stocks rather than safer assets — “have fallen sharply and are now largely back to levels seen in the run-up to the financial crisis.” That signal, Oppenheimer wrote, left stocks “more vulnerable to disappointments or shocks” brought on by technological competition or a worsening mix of growth and inflation.

Also read: Global economy faces prospect of another deep shock

To be clear, Oppenheimer is not predicting a bear market, but he warned that the risks of a correction are high.

Furthermore, he pointed out that stock valuations are high not just in the United States — something that has been the case for many years — but that all regions of the world have valuations “above their own long-term historical averages.” In other words, stocks are expensive everywhere and could be headed for a crash.

A strategist who predicted the movement

As early as 2024, Oppenheimer made a bold and largely accurate prediction that American stocks were becoming too expensive and recommended that investors diversify internationally.

The strategy was very successful when the European and Japanese markets soared, while American technology companies stumbled in the so-called “selling America” movement.

He reinforced this view in November 2025 with a ten-year outlook predicting that the S&P 500 would deliver just 6.5% annual returns—the worst among major regions—while emerging markets would lead with returns of nearly 11% annually.

He also pointed to artificial intelligence as a possible bubble risk, drawing explicit parallels between the stock market and speculative cycles of the past. (Of course, it is still too early to judge the accuracy of these predictions.)

How these forecasts pan out could influence the severity of any short-term correction, as some market signals are reminiscent of the 2007–08 Global Financial Crisis, but private sector balance sheets remain healthy among households, businesses and banks.

For this reason, market watchers have compared the current situation to the bursting of the internet bubble in the early 2000s. Earnings continue to support an upbeat narrative, and Goldman’s own research acknowledges that global earnings estimates have actually increased since the start of 2026 — an unusual and historically positive sign.

In any case, Oppenheimer, writing alongside colleagues Sharon Bell, Guillaume Jaisson and Giovanni Ferrannini, called the current combination of geopolitical uncertainty and market anxiety about artificial intelligence “a significant headwind for risk assets to absorb in the near term.”

Oppenheimer noted that the behavior of cyclical stocks can amplify risk, as sectors sensitive to swings in the economy have largely outperformed defensive sectors over the past year, and cyclical stocks now trade at roughly the same valuation as defensive stocks.

This price dynamic leaves little margin of safety if confidence falters. Any new shock to oil prices, a trade disruption or an escalation in the Middle East could quickly wipe out that margin.

The historic dismantling of technology

At the sector level, Oppenheimer highlights one of the most striking reversals in recent market history: Technology stocks have just gone through one of their weakest periods of relative performance compared to other sectors in the last 50 years.

The rotation — driven by investor anxiety over capital spending plans in artificial intelligence and fears that software business models will face disruption — has quickly reduced the valuation premium that the technology has long enjoyed.

In a surprising reversal, US industrial stocks, from companies that are intensive in factories and equipment, are now worth more in terms of price/earnings (P/E) than technology companies, which use few physical assets and have a strong base in software.

Despite the high risk of correction, Oppenheimer does not expect the market to suffer a prolonged decline.

Goldman economists project 2.8% GDP growth in the United States this year; global earnings estimates have risen since January; and private sector balance sheets — of households, companies and banks — remain healthy enough to absorb shocks without triggering systemic contagion.

Oppenheimer has previously noted that most geopolitical shocks trigger a median correction of about 6% in the S&P 500 over 18 days before stabilizing.

Ultimately, Oppenheimer recommended that investors maintain broad geographic, sector, and factor diversification—the same playbook he has been advocating for more than a year and which has proven its value.

“We see elevated correction risks given current valuations,” Oppenheimer wrote, “but we expect this represents a buying opportunity, with relatively low risk of a more prolonged and deeper bear market.”