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Maybe you should pull your face off pages of dailykos and use common sense.
51 million Americans have 401K accounts, and millions of others have other kinds of investments, and all of them benefit. They are the main street, and they are happy about the performance of their investments.
Yeah Finn but when the bubble pops all those benifits do too. The market is insane right now. Why do you think they won't stop the QE? The whole thing will crash and burn if they do. So every month the printing presses pump more in. Day traders love it I guess and the banks of course love it especailly since the Dodd/Frank act allows them to park money and gain interest. Interest on printed money. LOL. It's madness.
The current Price to Earnings ratio of the S&P 500 is 20.5
The Historic mean is 15.50 and the historic median is 14.51.
If we revert back to the historic mean before earnings can improve -- there will be a 24% drop in the S&P 500.
I wonder if the $85,000,000,000.00 a month in QE economic stimulus can continue forever to keep this propped up?
It can but it won't. IMO The Fed will begin tapering in 2014. And there will of course be market corrections as always when the Fed announces interest rate increases. IMO 24% is not too far off, but I think more on the lines of 10-15% when the markets come to their senses. Not as severe a hit as 2008. And the affect on the broad middle class will not be nearly as severe.
It is one very major indicator and very important piece of our economy. You can't much have a lasting depression/recession during a bull market. Although have we tried. You can't have a favorable economy with the stock market crashing. But the stock market itself is far from presenting the whole picture.
I bailed during the last bubble before it popped. I haven't been back in and have no regrets. When this one pops, (which it will) it will be HUGE. People will be jumping off cliffs.
I bailed during the last bubble before it popped. I haven't been back in and have no regrets. When this one pops, (which it will) it will be HUGE. People will be jumping off cliffs.
2008 was huge. This will be big.
I went back in and 2009-current have been my best market gains since the '80's. I have no regrets either.
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