A peak in an asset's price does not necessarily indicate a bubble, it indicates a high price. An asset bubble occurs when the price of an asset rises at a rapid pace without any underlying fundamentals. As we approach an all time high for gold is this a price bubble? Of course not, price is rising to new highs because faith in the future of the dollar is reaching new lows. The fundamentals for gold's demand have been and remain directly related to perception of the future outlook of the currency it is priced in.
Pick a better topic to troll.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
FOMO (Fear of Missing Out) money is flowing into the stock market like a large creek. Creek is fix'n to become a raging river. Get in now or regret it later.
Stocks win, again. Talking heads expecting unemployment to go up but we actually created and didn't lose jobs during the pandemic. Fake news perhaps but that 401K value is PHAT!
The whole worlds off its rocker, buy Gold™.
BOOMIN!™
@derryb said:
The dot com bubble was for amateurs:
The business World and the stock market weren't ready to interface with the internet in 1987. The World Wide Web was primative back then. Remember Dial up internet access ?
Now the new .com, the cloud, Zoom, the Amazon, 5G, ect, ect.
Apple & Microsoft are more refined now and have massive cash reserves. So your comparison is apples to oranges.
I strongly believe in gold and silver bullion's future. It will go parabolic soon enough. I am not selling off any of my gold and silver bullion to buy stocks. If gold and silver goes way up in price, I will sell some bullion and buy more stock.
@blitzdude said:
Stocks win, again. Talking heads expecting unemployment to go up but we actually created and didn't lose jobs during the pandemic. Fake news perhaps but that 401K value is PHAT!
Fraid not!
Fake news wants the stock market to crash like a mug.
Today it's the JOBs report....2.5 Milloin Jobs in May!
Stock market wins because America IS recovering. Even with all the Kung Flu, Rioting and depression era unemployment.
Don't bet againist America when it comes to a crisis. You will lose.
@blitzdude said:
Stocks win, again. Talking heads expecting unemployment to go up but we actually created and didn't lose jobs during the pandemic. Fake news perhaps but that 401K value is PHAT!
Fraid not!
Fake news wants the stock market to crash like a mug.
Today it's the JOBs report....2.5 Milloin Jobs in May!
Unemployment improving (how could it not by ending the lockdown), yet OFFICIAL rate is still high @ 13.3%. Just imagine what the unoffical, actual rate is.
Stock market wins because America IS recovering. Even with all the Kung Flu, Rioting and depression era unemployment.
Don't bet againist America when it comes to a crisis. You will lose.
yet in the prior post you "strongly believe in gold and silver bullion's future"? You do know what you are betting against, right?
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
@blitzdude said:
Stocks win, again. Talking heads expecting unemployment to go up but we actually created and didn't lose jobs during the pandemic. Fake news perhaps but that 401K value is PHAT!
Fraid not!
Fake news wants the stock market to crash like a mug.
Today it's the JOBs report....2.5 Milloin Jobs in May!
Stock market wins because America IS recovering. Even with all the Kung Flu, Rioting and depression era unemployment.
Don't bet againist America when it comes to a crisis. You will lose.
yet in the prior post you "strongly believe in gold and silver bullion's future"? You do know what you are betting against, right?
Nope. When one goes down the other goes up AKA Diversification strategy my man..
Stock market wins because America IS recovering. Even with all the Kung Flu, Rioting and depression era unemployment.
While most of America is getting BACK to work, the stock market wins for one reason: the FED is going all in at all cost to give the appearance that the stock market is winning. Election year.
On the other hand, the economy is not benefiting from the helicopter money.
So, the question remains. How do you get Americans to spend so that the economy gets stimulated along with a FED desired rise in inflation?
Simple you go to negative rates where it is better to spend your cash than save it and where it is tempting to borrow more to be spent today. What's the best way to force negative rates on spenders? Limit/remove their access to actual cash money and force them to hold digital money that IS exposed to negative rates.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
Stock market wins because America IS recovering. Even with all the Kung Flu, Rioting and depression era unemployment.
While most of America is getting BACK to work, the stock market wins for one reason: the FED is going all in at all cost to give the appearance that the stock market is winning. Election year.
On the other hand, the economy is not benefiting from the helicopter money.
So, the question remains. How do you get Americans to spend so that the economy gets stimulated along with a FED desired rise in inflation?
Simple you go to negative rates where it is better to spend your cash than save it and where it is tempting to borrow more to be spent today. What's the best way to force negative rates on spenders? Limit/remove their access to actual cash money and force them to hold digital money that IS exposed to negative rates.
The FED GOV didn't cause this total shut down. The Kung Flu did. I
f not for the FED GOV infusing cash, America would be much worse.
The stock market is the only entity I know who can darn near predict the future. This high prices are because of what's probably going to happen in the FUTURE. The stock market fore sees our future as extremely rosie.
Morale of the story, NEVER, EVER bet against the FED and their endless money printing machine! $6T in new debt the past 3 years, who cares my 401K is headed to Pluto baby! We're back. Semper Fi!!!
The whole worlds off its rocker, buy Gold™.
BOOMIN!™
@blitzdude said:
Morale of the story, NEVER, EVER bet against the FED and their endless money printing machine! $6T in new debt the past 3 years, who cares my 401K is headed to Pluto baby! We're back. Semper Fi!!!
The stock market ralley is more due to confidence in American companies bouncing back from a world wide pandemic than the national debt.
I'm sold on metals too. I'm extremely heavy on gold silver plat.
The stock market ralley is more due to confidence in American companies bouncing back from a world wide pandemic than the national debt.
There's still a very high unemployment rate, even using skewed "official" gov. calculations. Unemployment dropped to 13.4% from 14.7% using "revised methodologies" and "seasonal adjustments." Then comes the later "revisions." - What you count and how you count determines your total. Liars figure so that figures lie.
The reality, from shadowstats.com, is that May's unemployment rate was 35% while the "official" rate was 15%.
The stock market rally is due to confidence in the FED's ability to maintain an unlimited ink and paper supply.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
The stock market ralley is more due to confidence in American companies bouncing back from a world wide pandemic than the national debt.
There's still a very high unemployment rate, even using skewed "official" gov. calculations. Unemployment dropped to 13.4% from 14.7% using "revised methodologies" and "seasonal adjustments." Then comes the later "revisions." - What you count and how you count determines your total. Liars figure so that figures lie.
The reality, from shadowstats.com, is that May's unemployment rate was 35% while the "official" rate was 15%.
The stock market rally is due to confidence in the FED's ability to maintain an unlimited ink and paper supply.
So you think the rally has nothing to do with great company stock that got hammer because of the CVOVID virus comming back to normal prices???
I'll say it again. Don't bet againist America. You will lose.
MAGA babay.
Stock market wins because America IS recovering. Even with all the Kung Flu, Rioting and depression era unemployment.
While most of America is getting BACK to work, the stock market wins for one reason: the FED is going all in at all cost to give the appearance that the stock market is winning. Election year.
On the other hand, the economy is not benefiting from the helicopter money.
So, the question remains. How do you get Americans to spend so that the economy gets stimulated along with a FED desired rise in inflation?
Simple you go to negative rates where it is better to spend your cash than save it and where it is tempting to borrow more to be spent today. What's the best way to force negative rates on spenders? Limit/remove their access to actual cash money and force them to hold digital money that IS exposed to negative rates.
Negative rates actually stimulate savings. If folk do not feel they can earn money on their money, they will not spend. If they feel their nest egg cannot be replenished via interest they will not spend.
@cohodk said:
Negative rates actually stimulate savings. If folk do not feel they can earn money on their money, they will not spend. If they feel their nest egg cannot be replenished via interest they will not spend.
The Fed will not go to negative rates.
Charging people to save stimulates savings? You are joking - right? Why would anyone add to a savings account when the bank will take a percentage? People may pay down debt or put it in the coffee can and bury it, but more than likely they will accelerate purchases before the item becomes more expensive - which is the point of negative interest rates...
Negative rates actually stimulate savings. If folk do not feel they can earn money on their money, they will not spend. If they feel their nest egg cannot be replenished via interest they will not spend.
The Fed will not go to negative rates.
Only in your Bizzaro World.
Negative rates mean your savings account balance this month is less than it was last month. This might be an incentive to save to you but it is not to normal people. In addition, coming inflation will weaken their purchasing power over time; another incentive to spend now, not later. Again, I'm talking about normal people, obviously not you.
The FED says they do not want negative rates, but they also said QE was a temporary measure and that they were going to reduce their balance sheet. The FED in its search for a rise in inflation, does want people to spend. Negative rates, like inflation, will promote that.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
So you think the rally has nothing to do with great company stock that got hammer because of the CVOVID virus comming back to normal prices???
I'll say it again. Don't bet againist America. You will lose.
MAGA babay.
Fixed it for ya: "Don't bet againist America the FED." The FED is not Amercia, at least not yet.
That "great company stock" was highly overvalued before COVID. COVID was just a needle meeting a bubble. Stocks have not seen normal prices since the FED murdered market fundamentals and blew the bubble starting in 2009, That great company stock is currently far from rebounding on it's own. FED money is 110% behind it.
When one realizes that of the top 10% of income earners, 94.7% own stock, one understands that an overvalued stock market is a great "transferer of wealth."
So you think the rally has nothing to do with great company stock that got hammer because of the CVOVID virus comming back to normal prices???
I'll say it again. Don't bet againist America. You will lose.
MAGA babay.
Fixed it for ya: "Don't bet againist America the FED." The FED is not Amercia, at least not yet.
That "great company stock" was highly overvalued before COVID. COVID was just a needle meeting a bubble. Stocks have not seen normal prices since the FED murdered market fundamentals and blew the bubble starting in 2009, That great company stock is currently far from rebounding on it's own. FED money is 110% behind it.
When one realizes that of the top 10% of income earners, 94.7% own stock, one understands that an overvalued stock market is a great "transferer of wealth."
The facts are always wrong when one chooses to disregard them.
Stocks have the highest premiums (difference between stock price and actual book value) of any asset class and they are screaming "overpriced." Book value is simply a company's net value determined by total assets minus total liabilities on a per-share basis. Investors are willing to pay record premiums because, once again, the FED has their backs. (Likewise, you will see companies resort to stock buy backs, depleting their cash reserves, because they just witnessed FED bailouts to save those with no to little cash.)
For example:
Amazon's current share price is $2442.37. Its book value per share for the quarter that ended in Mar. 2020 was $129.00.
Microsoft's current price is $184.68. Its book value per share for the quarter that ended in Mar. 2020 was $14.92.
Facebook's current price is $225.99. Its book value per share for the quarter that ended in Mar. 2020 was $36.72.
Procter & Gamble Co's current price is $115.92. Its book value per share for the quarter that ended in Mar. 2020 was $17.08
Johnson & Johnson's current price is $147.19. Its book value per share for the quarter that ended in Mar. 2020 was $22.95.
Walmart's current price is $123.69. Its book value per share for the quarter that ended in Apr. 2020 was $23.95.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
@derryb said:
The facts are always wrong when one chooses to disregard them.
Stocks have the highest premiums (difference between stock price and actual book value) of any asset class and they are screaming "overpriced." Book value is simply a company's net value determined by total assets minus total liabilities on a per-share basis. Investors are willing to pay record premiums because, once again, the FED has their backs. (Likewise, you will see companies resort to stock buy backs, depleting their cash reserves, because they just witnessed FED bailouts to save those with no to little cash.)
For example:
Amazon's current share price is $2442.37. Its book value per share for the quarter that ended in Mar. 2020 was $129.00.
Microsoft's current price is $184.68. Its book value per share for the quarter that ended in Mar. 2020 was $14.92.
Facebook's current price is $225.99. Its book value per share for the quarter that ended in Mar. 2020 was $36.72.
Procter & Gamble Co's current price is $115.92. Its book value per share for the quarter that ended in Mar. 2020 was $17.08
Johnson & Johnson's current price is $147.19. Its book value per share for the quarter that ended in Mar. 2020 was $22.95.
Walmart's current price is $123.69. Its book value per share for the quarter that ended in Apr. 2020 was $23.95.
And a $20 Saint Gaudens was $20, now it's worth is well over $2,000.
@derryb said:
The facts are always wrong when one chooses to disregard them.
Stocks have the highest premiums (difference between stock price and actual book value) of any asset class and they are screaming "overpriced." Book value is simply a company's net value determined by total assets minus total liabilities on a per-share basis. Investors are willing to pay record premiums because, once again, the FED has their backs. (Likewise, you will see companies resort to stock buy backs, depleting their cash reserves, because they just witnessed FED bailouts to save those with no to little cash.)
For example:
Amazon's current share price is $2442.37. Its book value per share for the quarter that ended in Mar. 2020 was $129.00.
Microsoft's current price is $184.68. Its book value per share for the quarter that ended in Mar. 2020 was $14.92.
Facebook's current price is $225.99. Its book value per share for the quarter that ended in Mar. 2020 was $36.72.
Procter & Gamble Co's current price is $115.92. Its book value per share for the quarter that ended in Mar. 2020 was $17.08
Johnson & Johnson's current price is $147.19. Its book value per share for the quarter that ended in Mar. 2020 was $22.95.
Walmart's current price is $123.69. Its book value per share for the quarter that ended in Apr. 2020 was $23.95.
And a $20 Saint Gaudens was $20, now it's worth is well over $2,000.
And Walmart's initial stock price was $16.50 in 1970. Has zero to do with current premium. You're confusing price inflation with current premium. Current numbers determine current premium. The current premium on your gold coin is 18.6%.
Walmart stock (price currently $123.69 and book value of $23.95) is looking at a 516% premium.
Which one is likely overvalued and likely in a bubble (driven by market participants above its value in relation to some system of valuation)?
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
The stock market rally is due to confidence in the FED's ability to maintain an unlimited ink and paper supply.
Pretty clear The Fed plus Washington, D.C. plan to buy off any and all recessions/slowdowns with trillions more in QE/debt. They simply will not let nature run its course where recessions are regular events. The piles of USD pouring into the system every day are staggering.
It's absolute insanity. And it will happen as long as the USD has a breath of air in it. The Golden Goose is in the crock pot and the heat is being turned up. Rapidly.
@cohodk said:
Negative rates actually stimulate savings. If folk do not feel they can earn money on their money, they will not spend. If they feel their nest egg cannot be replenished via interest they will not spend.
The Fed will not go to negative rates.
Charging people to save stimulates savings? You are joking - right? Why would anyone add to a savings account when the bank will take a percentage? People may pay down debt or put it in the coffee can and bury it, but more than likely they will accelerate purchases before the item becomes more expensive - which is the point of negative interest rates...
I seen youve gone to the derrydoom school of finance.
The scenario you describe is inflation. Negative rates promote deflation. Negative rates promote the concept of zero time value of money. This is deflationary.
Negative rates actually stimulate savings. If folk do not feel they can earn money on their money, they will not spend. If they feel their nest egg cannot be replenished via interest they will not spend.
The Fed will not go to negative rates.
Only in your Bizzaro World.
Negative rates mean your savings account balance this month is less than it was last month. This might be an incentive to save to you but it is not to normal people. In addition, coming inflation will weaken their purchasing power over time; another incentive to spend now, not later. Again, I'm talking about normal people, obviously not you.
The FED says they do not want negative rates, but they also said QE was a temporary measure and that they were going to reduce their balance sheet. The FED in its search for a rise in inflation, does want people to spend. Negative rates, like inflation, will promote that.
Yeah...its better to buy stuff we don't need which will end up in a landfill or yard sale than leave money in the bank. Lol. Classic derrydoom.
Honey, were gonna be charged $1000 on our $100,000 in savings. Let's go buy a Ferrari or a boat!!! Yup, normal people.
@cohodk said:
Negative rates actually stimulate savings. If folk do not feel they can earn money on their money, they will not spend. If they feel their nest egg cannot be replenished via interest they will not spend.
The Fed will not go to negative rates.
Charging people to save stimulates savings? You are joking - right? Why would anyone add to a savings account when the bank will take a percentage? People may pay down debt or put it in the coffee can and bury it, but more than likely they will accelerate purchases before the item becomes more expensive - which is the point of negative interest rates...
I seen youve gone to the derrydoom school of finance.
The scenario you describe is inflation. Negative rates promote deflation. Negative rates promote the concept of zero time value of money. This is deflationary.
The scenario you describe is inflation. Negative rates promote deflation. Negative rates promote the concept of zero time value of money. This is deflationary.
What do you think is fueling the real estate market you have been touting as if you have some brilliant investment acumen? Your gains are simply inflation, being driven by low - and in Europe negative - interest rates.
Who said they would work? I've been telling you for years that your central bank takes the wrong approach. Now you agree?
I'm only educating you on their intended purpose which may or many not attain their desired goal. If you don't see them working, by all means let the FED know.
Central banks see them as a tool to accomplish two things:
Stimulate spending (increasing the velocity of money, MV).
Negative rates on bank deposits will entice consumers to either spend or put their money elsewhere. Putting it "under the mattress" (hoarding cash) can be eliminated by outlawing the cash and going 100% digital. Spending can be further stimulated by lowering loan rates. If a bank is no longer PAYING interest on deposits it needs no income from loans to pay a savings rate. If banks receive enough income from negative rates on deposits they can theoretically go negative on their loan rates and create some serious spending stimuli. Banks profit from the spread they pay/earn with rates. If that spread can actually be increased with negative rates, look for banks to be big proponents of a negative rate policy.
Increase inflation
Their money supply increases in the past did not and are currently not causing the desired price inflation. Remember, your central bank says a min. 2% inflation rate is "healthy." Negative rates on bank deposits will cause savers to look for alternatives rather than pay the bank to hold their money. If prices are rising and its costing them money to save, consumers will spend. Lower loan rates will increase borrowing and that borrowed money gets spent.
Note that an increase in MV (spending) results in higher sales tax revenues because money is changing hands more rapidly. States will benefit from the income and because of this I expect a negative rate policy rate to open discussions for a federal sales tax (known as a Value Added Tax, VAT, in Europe) in order to increase federal tax revenue.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
@taxmad said:
What do you think is fueling the real estate market you have been touting as if you have some brilliant investment acumen? Your gains are simply inflation, being driven by low - and in Europe negative - interest rates.
Oh, i am brilliant. Sorry to not be one of the normal folk. Thanks derryb for agreeing. LOL
Increased demand. Growing population = growing demand for homes.
I read that in the Econ 101 book you recommended. You should read it too.
But....since you bring up inflation. Wasnt silver touted as an asset that would do well with inflation? Yet here it is, same price as seemingly forever. Yet, you say real estate is a terrible investment and it only went up because of inflation. So you say there was inflation but insist silver is a good hedge even though it hasnt done squat, but say real estate sucks and its done well.
There will be no negative interest rate policy in the USA. But I will agree with you that there will be a VAT. And frankly im surprised we dont already have one.
You gotta get this through your head. NO ONE BENEFITS FROM NEGATIVE RATES. Not banks, not consumers, not savers, not borrowers. NO ONE.
It will happen because, aside from the central bank desire for an increase in spending AND in inflation, there is likely a hidden agenda that will result in a FURTHER transfer of wealth.
I believe you once declared there would be no further QE.
You and the blitzboy should start a hedge fund.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
@taxmad said:
What do you think is fueling the real estate market you have been touting as if you have some brilliant investment acumen? Your gains are simply inflation, being driven by low - and in Europe negative - interest rates.
And the smart people wanting to move out of the crowed cities into the safer suburbs. Not as much Kung flu and rioting in the suburbs.
@taxmad said:
What do you think is fueling the real estate market you have been touting as if you have some brilliant investment acumen? Your gains are simply inflation, being driven by low - and in Europe negative - interest rates.
And the smart people wanting to move out of the crowed cities into the safer suburbs. Not as much Kung flu and rioting in the suburbs.
Suburbs? LOL
The whole worlds off its rocker, buy Gold™.
BOOMIN!™
@taxmad said:
What do you think is fueling the real estate market you have been touting as if you have some brilliant investment acumen? Your gains are simply inflation, being driven by low - and in Europe negative - interest rates.
And the smart people wanting to move out of the crowed cities into the safer suburbs. Not as much Kung flu and rioting in the suburbs.
Suburbs? LOL
Suburbs and of course out in the country also Captain Obvious.
@derryb said:
Sounds like irrational exuberance. I think you should double down.
Damn. well that's just a mean comment. You only say that because you want me to lose. Is it because I don't agree with you? Misery loves company I guess.
Comments
You do have the funniest comments. And a short memory, perhaps thats just willful.
1980 and 2011.
Fairy tales usually do not contain facts.
Knowledge is the enemy of fear
A peak in an asset's price does not necessarily indicate a bubble, it indicates a high price. An asset bubble occurs when the price of an asset rises at a rapid pace without any underlying fundamentals. As we approach an all time high for gold is this a price bubble? Of course not, price is rising to new highs because faith in the future of the dollar is reaching new lows. The fundamentals for gold's demand have been and remain directly related to perception of the future outlook of the currency it is priced in.
Pick a better topic to troll.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
Like tye fundamentals in 1980 and 2011, after which PMs dropped 70-90%, and then languished for decades.
Pick a better topic to troll.
Knowledge is the enemy of fear
sometimes you even funny
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
The dot com bubble was for amateurs:
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
FOMO (Fear of Missing Out) money is flowing into the stock market like a large creek. Creek is fix'n to become a raging river. Get in now or regret it later.
Stocks win, again. Talking heads expecting unemployment to go up but we actually created and didn't lose jobs during the pandemic. Fake news perhaps but that 401K value is PHAT!
The whole worlds off its rocker, buy Gold™.
BOOMIN!™
The business World and the stock market weren't ready to interface with the internet in 1987. The World Wide Web was primative back then. Remember Dial up internet access ?
Now the new .com, the cloud, Zoom, the Amazon, 5G, ect, ect.
Apple & Microsoft are more refined now and have massive cash reserves. So your comparison is apples to oranges.
I strongly believe in gold and silver bullion's future. It will go parabolic soon enough. I am not selling off any of my gold and silver bullion to buy stocks. If gold and silver goes way up in price, I will sell some bullion and buy more stock.
Fraid not!
Fake news wants the stock market to crash like a mug.
Today it's the JOBs report....2.5 Milloin Jobs in May!
Stock market wins because America IS recovering. Even with all the Kung Flu, Rioting and depression era unemployment.
Don't bet againist America when it comes to a crisis. You will lose.
Unemployment improving (how could it not by ending the lockdown), yet OFFICIAL rate is still high @ 13.3%. Just imagine what the unoffical, actual rate is.
yet in the prior post you "strongly believe in gold and silver bullion's future"? You do know what you are betting against, right?
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
Nope. When one goes down the other goes up AKA Diversification strategy my man..
While most of America is getting BACK to work, the stock market wins for one reason: the FED is going all in at all cost to give the appearance that the stock market is winning. Election year.
On the other hand, the economy is not benefiting from the helicopter money.
So, the question remains. How do you get Americans to spend so that the economy gets stimulated along with a FED desired rise in inflation?
Simple you go to negative rates where it is better to spend your cash than save it and where it is tempting to borrow more to be spent today. What's the best way to force negative rates on spenders? Limit/remove their access to actual cash money and force them to hold digital money that IS exposed to negative rates.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
I'm way, way metals heavy actually.> @derryb said:
The FED GOV didn't cause this total shut down. The Kung Flu did. I
f not for the FED GOV infusing cash, America would be much worse.
The stock market is the only entity I know who can darn near predict the future. This high prices are because of what's probably going to happen in the FUTURE. The stock market fore sees our future as extremely rosie.
Morale of the story, NEVER, EVER bet against the FED and their endless money printing machine! $6T in new debt the past 3 years, who cares my 401K is headed to Pluto baby! We're back. Semper Fi!!!
The whole worlds off its rocker, buy Gold™.
BOOMIN!™
The stock market ralley is more due to confidence in American companies bouncing back from a world wide pandemic than the national debt.
I'm sold on metals too. I'm extremely heavy on gold silver plat.
There's still a very high unemployment rate, even using skewed "official" gov. calculations. Unemployment dropped to 13.4% from 14.7% using "revised methodologies" and "seasonal adjustments." Then comes the later "revisions." - What you count and how you count determines your total. Liars figure so that figures lie.
The reality, from shadowstats.com, is that May's unemployment rate was 35% while the "official" rate was 15%.
The stock market rally is due to confidence in the FED's ability to maintain an unlimited ink and paper supply.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
P> @derryb said:
So you think the rally has nothing to do with great company stock that got hammer because of the CVOVID virus comming back to normal prices???
I'll say it again. Don't bet againist America. You will lose.
MAGA babay.
Do you really think 1 out of 3 working age Americans, who are not students, incarcerated, or active military are not working?
Knowledge is the enemy of fear
Negative rates actually stimulate savings. If folk do not feel they can earn money on their money, they will not spend. If they feel their nest egg cannot be replenished via interest they will not spend.
The Fed will not go to negative rates.
Knowledge is the enemy of fear
Charging people to save stimulates savings? You are joking - right? Why would anyone add to a savings account when the bank will take a percentage? People may pay down debt or put it in the coffee can and bury it, but more than likely they will accelerate purchases before the item becomes more expensive - which is the point of negative interest rates...
Only in your Bizzaro World.
Negative rates mean your savings account balance this month is less than it was last month. This might be an incentive to save to you but it is not to normal people. In addition, coming inflation will weaken their purchasing power over time; another incentive to spend now, not later. Again, I'm talking about normal people, obviously not you.
The FED says they do not want negative rates, but they also said QE was a temporary measure and that they were going to reduce their balance sheet. The FED in its search for a rise in inflation, does want people to spend. Negative rates, like inflation, will promote that.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
Fixed it for ya: "Don't bet againist America the FED." The FED is not Amercia, at least not yet.
That "great company stock" was highly overvalued before COVID. COVID was just a needle meeting a bubble. Stocks have not seen normal prices since the FED murdered market fundamentals and blew the bubble starting in 2009, That great company stock is currently far from rebounding on it's own. FED money is 110% behind it.
When one realizes that of the top 10% of income earners, 94.7% own stock, one understands that an overvalued stock market is a great "transferer of wealth."
Don't see the transfer of wealth? As of 2013, the top 1% of households owned 38% of stock market wealth.
As of 2013, the top 10% own 81% of stock wealth.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
The facts are always wrong when one chooses to disregard them.
Stocks have the highest premiums (difference between stock price and actual book value) of any asset class and they are screaming "overpriced." Book value is simply a company's net value determined by total assets minus total liabilities on a per-share basis. Investors are willing to pay record premiums because, once again, the FED has their backs. (Likewise, you will see companies resort to stock buy backs, depleting their cash reserves, because they just witnessed FED bailouts to save those with no to little cash.)
For example:
Amazon's current share price is $2442.37. Its book value per share for the quarter that ended in Mar. 2020 was $129.00.
Microsoft's current price is $184.68. Its book value per share for the quarter that ended in Mar. 2020 was $14.92.
Facebook's current price is $225.99. Its book value per share for the quarter that ended in Mar. 2020 was $36.72.
Procter & Gamble Co's current price is $115.92. Its book value per share for the quarter that ended in Mar. 2020 was $17.08
Johnson & Johnson's current price is $147.19. Its book value per share for the quarter that ended in Mar. 2020 was $22.95.
Walmart's current price is $123.69. Its book value per share for the quarter that ended in Apr. 2020 was $23.95.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
My Boeing stock has doubled already, time to sell half to get my base back and let the rest ride as it’s pure profit at that point
And a $20 Saint Gaudens was $20, now it's worth is well over $2,000.
And Walmart's initial stock price was $16.50 in 1970. Has zero to do with current premium. You're confusing price inflation with current premium. Current numbers determine current premium. The current premium on your gold coin is 18.6%.
Walmart stock (price currently $123.69 and book value of $23.95) is looking at a 516% premium.
Which one is likely overvalued and likely in a bubble (driven by market participants above its value in relation to some system of valuation)?
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
Pretty clear The Fed plus Washington, D.C. plan to buy off any and all recessions/slowdowns with trillions more in QE/debt. They simply will not let nature run its course where recessions are regular events. The piles of USD pouring into the system every day are staggering.
It's absolute insanity. And it will happen as long as the USD has a breath of air in it. The Golden Goose is in the crock pot and the heat is being turned up. Rapidly.
I seen youve gone to the derrydoom school of finance.
The scenario you describe is inflation. Negative rates promote deflation. Negative rates promote the concept of zero time value of money. This is deflationary.
Knowledge is the enemy of fear
Yeah...its better to buy stuff we don't need which will end up in a landfill or yard sale than leave money in the bank. Lol. Classic derrydoom.
Honey, were gonna be charged $1000 on our $100,000 in savings. Let's go buy a Ferrari or a boat!!! Yup, normal people.
Hot dang, you crack me up. LOL
Knowledge is the enemy of fear
Wrong, wrong, wrong. Negative rates are designed to stimulate spending, not savings. This leads to central bank desired inflation. Their purpose is to end a deflationary sprial.
Unless of course one holds a Coho School of Economics degree.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
You really need to read a Econ 101 book...
You guys really need to get a clue and probably step into the real world.
Ask Japan how negative rates have inceased personal spending.
Ask Europe have negative rates have increased spending.
Ask yourself if you are going to buy more stuff. Ask your mama if she is going to buy more stuff.
Or just keep counting beans and selling snake oil. Thats what you do best.
Knowledge is the enemy of fear
What do you think is fueling the real estate market you have been touting as if you have some brilliant investment acumen? Your gains are simply inflation, being driven by low - and in Europe negative - interest rates.
Who said they would work? I've been telling you for years that your central bank takes the wrong approach. Now you agree?
I'm only educating you on their intended purpose which may or many not attain their desired goal. If you don't see them working, by all means let the FED know.
Central banks see them as a tool to accomplish two things:
Stimulate spending (increasing the velocity of money, MV).
Negative rates on bank deposits will entice consumers to either spend or put their money elsewhere. Putting it "under the mattress" (hoarding cash) can be eliminated by outlawing the cash and going 100% digital. Spending can be further stimulated by lowering loan rates. If a bank is no longer PAYING interest on deposits it needs no income from loans to pay a savings rate. If banks receive enough income from negative rates on deposits they can theoretically go negative on their loan rates and create some serious spending stimuli. Banks profit from the spread they pay/earn with rates. If that spread can actually be increased with negative rates, look for banks to be big proponents of a negative rate policy.
Increase inflation
Their money supply increases in the past did not and are currently not causing the desired price inflation. Remember, your central bank says a min. 2% inflation rate is "healthy." Negative rates on bank deposits will cause savers to look for alternatives rather than pay the bank to hold their money. If prices are rising and its costing them money to save, consumers will spend. Lower loan rates will increase borrowing and that borrowed money gets spent.
Note that an increase in MV (spending) results in higher sales tax revenues because money is changing hands more rapidly. States will benefit from the income and because of this I expect a negative rate policy rate to open discussions for a federal sales tax (known as a Value Added Tax, VAT, in Europe) in order to increase federal tax revenue.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
Oh, i am brilliant. Sorry to not be one of the normal folk. Thanks derryb for agreeing. LOL
Increased demand. Growing population = growing demand for homes.
I read that in the Econ 101 book you recommended. You should read it too.
But....since you bring up inflation. Wasnt silver touted as an asset that would do well with inflation? Yet here it is, same price as seemingly forever. Yet, you say real estate is a terrible investment and it only went up because of inflation. So you say there was inflation but insist silver is a good hedge even though it hasnt done squat, but say real estate sucks and its done well.
Do you guys actually read the words you write?
Knowledge is the enemy of fear
There will be no negative interest rate policy in the USA. But I will agree with you that there will be a VAT. And frankly im surprised we dont already have one.
You gotta get this through your head. NO ONE BENEFITS FROM NEGATIVE RATES. Not banks, not consumers, not savers, not borrowers. NO ONE.
It will not happen.
Knowledge is the enemy of fear
It will happen because, aside from the central bank desire for an increase in spending AND in inflation, there is likely a hidden agenda that will result in a FURTHER transfer of wealth.
I believe you once declared there would be no further QE.
You and the blitzboy should start a hedge fund.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
And the smart people wanting to move out of the crowed cities into the safer suburbs. Not as much Kung flu and rioting in the suburbs.
Suburbs? LOL
The whole worlds off its rocker, buy Gold™.
BOOMIN!™
APPLE up $330. MSFT is going to run up I do believe> @blitzdude said:
Suburbs and of course out in the country also Captain Obvious.
Up. up and away!
The bulls and the emotion of FOMO are in charge now.
Buying more MSFT.
Sounds like irrational exuberance. I think you should double down.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
Damn. well that's just a mean comment. You only say that because you want me to lose. Is it because I don't agree with you? Misery loves company I guess.
Irrational exuberance refers to extreme investor enthusiasm that drives asset prices beyond levels that are not supported by fundamentals.
I say that because 12.38 is a pretty high price to book ratio. Do the fundamentals support the price you paid? Likely not, but If so, my apologies.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong