Quote:
Originally Posted by noneofyourbusiness
"This is not unusual in market history. When the spell is finally broken and markets wake up to reality, we will scratch our heads and wonder how we could ever have been so misguided." From the link in the last post.
The stock market is in bubble teritory, so is real estate. Give or take a bit 50% of the loans out there are bad. Maybe just 25%.
If you want to stop the bubbles from popping then we need inflation. Wage driven inflation to reduce the value of our cerrent debt by 50%. We have time to restructure our debts if we want to. All of them at the same time.
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Are you saying that QE is misguided policy? Keeping interest rates low is an attempt to fuel a weak economy.
What one hears is that a fair number of people on C-D worry that QE is feeding speculative bubbles, as investors search for yield that really isn’t there.
But surely that’s a feature of cheap money in general; the same argument could be used for raising short-term rates despite a weak economy and low inflation.