- Joined
- 3 April 2011
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- 27
Can anyone provide some explanation as to why the stock market is rising right now? I can't believe what I'm seeing.
Who knows and who cares....Can anyone provide some explanation as to why the stock market is rising right now? I can't believe what I'm seeing.
I believe this is a good question.Can anyone provide some explanation as to why the stock market is rising right now? I can't believe what I'm seeing.
So far as I can determine that is indeed the answer. It's herd mentality and FOMO not a response based on any serious economic forecasts etc.It's simply herd mentality driving the market right now.
I believe this is a good question.
The answer is because it is.
Crowd behaviour. Fear of missing out. FOMO. I'm buggered if I can work it out. I'm fairly well cashed up and will enter when it is right for me on certain shares.
An interesting article from the SMH for the bear side of all this joyous behaviour.
https://www.smh.com.au/business/mar...ends-sharemarket-warning-20200527-p54wr5.html
gg
It is the FED that is inflating the markets: never fight the FED head on, you will lose. The FED will buy stocks on-market like the Bank Of Japan if they have to; to keep stocks inflated.
When the music ends, I don't know. Call me a precious metal bug if you like; but I see gold and silver doing extremely well from the currency debasement. I am relatively young, so I can play the multi-decade long game, some can't.
Pro tip I heard today - The stock market is not the economy.
It’s simply billions of stimulus $s
And will keep powering !
QE may be a good strategy when we are in a crisis like the GFC. The following defaults had a major knock on effect that went global thanks to our trusty investment banks. It was the fact that they had a section of the economy who received loans they could not pay back. Consumption was not the primary issue then as it is now. Money printing and government spending helped because credit was made cheap, some regulations on lending practices were tightened, and the US gov spent in key areas to boost the US economy which helped alleviate business investment woes.
But....now we are faced with an earnings crisis. If we don't earn we have nothing to spend. Cheap money puts us further into debt and debt is a major issue now because we have less earnings to pay it off. So, money printing on a small scale may help a little, but really what are we doing about consumption?? That's the key here! We are now seeing the end result of a long string of terrible government policies. Governments cooking the books has had shirt term benefits with long term consequences. Excess immigration and the downward pressure on wage growth, unchecked foreign ownership of a nations assets, industrial relations reforms, and a whole bunch of other things that will affect the ability if wages to rise with inflation. The real value of our money is so important here.
So I would add to the statement, 'don't fight the fed' by saying this is ok if they are using the right policy to dig us out of this hole.
Government spending, subsidies, lower taxes in key areas, and diversified trade deals (not the China centric ones we have) would be a great start in lowering risk and driving wages. Cutting immigration is a must here (if only for 5-10 years) to enable this recovery to occur. Boosting it will take us back to the start where we will be relying on this influx if capital to cook the books once again. But.. we can't talk about that.. Its racist.
I truly believe the current market speculation shares the same short sightedness our governments use when implementing their plans for long term growth. In all fairness, it's probably very difficult to implement economic growth policies from the bottom of a pit dug by prior poor decisions. There is nowhere for policy makers to turn, so they gamble with dubious policies.
In the context of our rising market in these dubious economic times, maybe investors are faced with the same dilemma.
Have a read; https://mises.org/library/prosperity-and-depressionQE may be a good strategy when we are in a crisis like the GFC. The following defaults had a major knock on effect that went global thanks to our trusty investment banks. It was the fact that they had a section of the economy who received loans they could not pay back. Consumption was not the primary issue then as it is now. Money printing and government spending helped because credit was made cheap, some regulations on lending practices were tightened, and the US gov spent in key areas to boost the US economy which helped alleviate business investment woes.
But....now we are faced with an earnings crisis. If we don't earn we have nothing to spend. Cheap money puts us further into debt and debt is a major issue now because we have less earnings to pay it off. So, money printing on a small scale may help a little, but really what are we doing about consumption?? That's the key here! We are now seeing the end result of a long string of terrible government policies. Governments cooking the books has had shirt term benefits with long term consequences. Excess immigration and the downward pressure on wage growth, unchecked foreign ownership of a nations assets, industrial relations reforms, and a whole bunch of other things that will affect the ability if wages to rise with inflation. The real value of our money is so important here.
So I would add to the statement, 'don't fight the fed' by saying this is ok if they are using the right policy to dig us out of this hole.
Government spending, subsidies, lower taxes in key areas, and diversified trade deals (not the China centric ones we have) would be a great start in lowering risk and driving wages. Cutting immigration is a must here (if only for 5-10 years) to enable this recovery to occur. Boosting it will take us back to the start where we will be relying on this influx if capital to cook the books once again. But.. we can't talk about that.. Its racist.
I truly believe the current market speculation shares the same short sightedness our governments use when implementing their plans for long term growth. In all fairness, it's probably very difficult to implement economic growth policies from the bottom of a pit dug by prior poor decisions. There is nowhere for policy makers to turn, so they gamble with dubious policies.
In the context of our rising market in these dubious economic times, maybe investors are faced with the same dilemma.
Don’t limit yourself with one forest porky
Similar forests
Property
Commercial and Domestic
Gold
Collectables
Business
Very different forests.
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