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They are tapering it, and just today they said they will keep tapering. DOW jumped 200 points.
That is good to hear. But putting in 65 billion a month is still too much. I'd prefer if they stopped it entirely but at the very least they should continue the tapering.
It would be scary.....if the scales hadn't been grossly manipulated.
1928-1929 was a bubble (and burst) of epic proportions. Stocks went up nearly 90% in a 12 month period. The collapse was equally as shocking.
2012-2013 was a only 30% gain. Could we be facing a correction? Frankly I expect it after watching the stock market gain that much in a 2 year period where nominal GDP only grew ~10%. But I don't think the correction is going to wipe out half the stock market value again. At the market peak in 1929 stocks were selling at 32 times earnings. At the most recent peak stock values were still under 20 X earnings. The delta between GDP and stock value gains as well as the PE ratios suggest a maximum correction of 20% barring outside factors that materially change the earnings outlook.
This chart has been manipulated to obscure the difference in the relative proportions of the run-up in stock values.
It would be scary.....if the scales hadn't been grossly manipulated.
1928-1929 was a bubble (and burst) of epic proportions. Stocks went up nearly 90% in a 12 month period. The collapse was equally as shocking.
2012-2013 was a only 30% gain. Could we be facing a correction? Frankly I expect it after watching the stock market gain that much in a 2 year period where nominal GDP only grew ~10%. But I don't think the correction is going to wipe out half the stock market value again. At the market peak in 1929 stocks were selling at 32 times earnings. At the most recent peak stock values were still under 20 X earnings. The delta between GDP and stock value gains as well as the PE ratios suggest a maximum correction of 20% barring outside factors that materially change the earnings outlook.
This chart has been manipulated to obscure the difference in the relative proportions of the run-up in stock values.
This graph was debunked sometime ago. And it still continues to draw in the doom and gloomers.
why, because many of us would lose a heck of a lot of money or a lot for us anyway. Even seeing it go down enough to cause us to lose a couple thousand is devastating, for those of us who don't have a lot of money, especially people who are retired or close to retirement and prefer not to survive on government handouts. Most of us can live with some adjustments, but to see it fall, fall, fall can hurt more than help. Retirement plans, 401Ks, etc would be affected big time and with more companies paying little or no retirements anymore, 401Ks are what people need for survival when they reach that golden age.
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Why?
