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With most of the wealth of the US concentrated in the hands of a small plurality, which is currently growing, and having most of that money probably in the hands of Wall Street, this does not come as a surprise.
I feel the real issue is the income inequality and not specifically how much money is being thrown into the stock market.
Fascinating, since the policies of the Obama administration have, therefore, led to the increased concentration of wealth in the small plurality. So you agree that the Obama administration is responsible for income inequality and therefore his party should be thrown out of office. Good to know you're on our side.
The entire stock market, not only in the U.S. but world wide, scares me. It's all inflated paper imo.
Technically, although you are right, we're still at the point where people will accept the currency as "real." In other words, it does still have some value, although it is inflated. But if we continue with our current liberal policies, at some point someone's going to say "uh ...this paper is worth nothing," you are correct about that.
... I feel the real issue is the income inequality and not specifically how much money is being thrown into the stock market.
The real issue is not the slice of the pie. The real issue is the pie isn't growing the way it should be growing in order to support full employment & wealth creation.
We currently have a rare combination of (a) high asset prices with low implied equity premium going forward, which means business isn't expected to grow, and (b) low interest rates with a low term-premium, bad for investors.
At the end of the day, these reflect the anti-business and anti-wealth creation policies of our government.
Technically, it isn't insider trading, but it sure doesn't feel right. It doesn't harm individual investors - the extra dollar I might pay when I purchase a block of stock doesn't matter to me. It does harm institutional investors such as pension plans & college endowments, as they are dealing with boatloads more money than me.
It's not insider trading, but it is technically illegal. The reason is because the money being pumped into the stock market is not being distributed evenly to everyone. It's being directed towards certain companies. So while they technically don't have "insider knowledge" of what's going on, they are selectively benefiting. In addition, the money is just being printed, so it's Monopoly money that is being injected into the market, which dilutes the value of our currency and distorts the market.
Basically, Obama is saving his own bacon and someone down the line is going to experience a huge correctional market crash and then the Democrats will blame that administration (which will undoubtedly be a Republican one).
The stock market is soaring partly because of the expansionary monetary policy instituted by the federal reserve. If unemployment continues to drop, the fed will raise interest rates and people will re-balance their portfolios and pull money from their equities and the stock market will take a hit. That is why "good" and "bad" unemployment numbers are somewhat counter intuitively reflected in the value of the various stock market indices. The reason why people are still a bit nervous is that interest rates are already so low that the fed does not have the full range of tools available to resuscitate the economy if we were to hit another slowdown. Everyone thinks that they can time the index drop once the fed hints that the monetary policy will be tightened. Some will, some won't, but a lot of people will end up taking a big hit on equities. Then again, anyone that has no exposure to equities over the past four years or so missed out on a big opportunity. If predicting it was easy, everyone would be able to do it and there would be no winners or losers. There are lots of ways to mitigate the risk, but there is a lot of money to be made for those that want to roll the dice.
Fascinating, since the policies of the Obama administration have, therefore, led to the increased concentration of wealth in the small plurality. So you agree that the Obama administration is responsible for income inequality and therefore his party should be thrown out of office. Good to know you're on our side.
I am not saying it was Obama, nor am I placing the blame on anyone. The OP mentions how the market is growing, but the rest of the economy, employment are not doing anywhere near what ought to be considering. That is largely because of income inequality. The ones with all the money are apparently investing in stocks.
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