Big Stock Market crash coming?

[rynnor]

The US Stock markets are overheated with the Dow at record levels which does not reflect the performance of the real economy - you have to wonder if a big correction of the market could be due soon?

 

[Chilly]

The US Stock markets are overheated with the Dow at record levels which does not reflect the performance of the real economy - you have to wonder if a big correction of the market could be due soon?

It's inflation and money printing that push the prices up. If you take into account how much inflation has happened since the market raping of a few years ago (probably a good 20-30 % devaluation in USD) this peak isn't really a peak.

 

[ECA]

The dow doesn't need to reflect the real economy, I think 98 of 100 companies are incorporated in delaware for tax reasons and many of them enjoy government subsidies/tax breaks.
It would be like giving Richard Branson a free billion a year because he's such a nice bloke and really needs the help at the moment.

Anyone want to move to the US and try lobbying to get free handouts like that? :d

 

[rynnor]

It's inflation and money printing that push the prices up. If you take into account how much inflation has happened since the market raping of a few years ago (probably a good 20-30 % devaluation in USD) this peak isn't really a peak.

Thats a good point and I'm sure that plays a part but considering how bad the economy has been I'm suprised to see it going up at all...

 

[Scouse]

It's only bad for us plebs. The rich have seen their investments go up nearly 50% in value since the "crash" - and since they own the majority of the worlds wealth then "money" is doing very nicely, thankyouverymuch.

It helps that "the people" are being fucked in the arse to keep the rich swimming in it. But that's what it is to be a slave...

 

[Chilly]

Thats a good point and I'm sure that plays a part but considering how bad the economy has been I'm suprised to see it going up at all...

Why are you surprised? The US government is borrowing over $1tn a year and spending it. US companies are getting that money. Add in some inflation et voilla. It's false. The US is incapable of reigning in borrowing with their current weak government and the economy will properly tank if they dont sort it out in the next few years.

 

[rynnor]

Why are you surprised? The US government is borrowing over $1tn a year and spending it. US companies are getting that money. Add in some inflation et voilla. It's false. The US is incapable of reigning in borrowing with their current weak government and the economy will properly tank if they dont sort it out in the next few years.

Isn't this just a reinforcing arguement for the eventual Stock crash though?

 

[Chilly]

Isn't this just a reinforcing arguement for the eventual Stock crash though?

Yes, but not until their borrowing costs start rising. For now, they're ludicrously low, so they'll keep borrowing.

 

[Chilly]

Yes, but not until their borrowing costs start rising. For now, they're ludicrously low, so they'll keep borrowing.

Same in the UK, unfortunately. Except our government is slightly stronger and is able to pass legislation to curb spending.

 

[Raven]

It helps that we have a population that generally understands the need to curb spending without accusing everyone of being a red.