Good point AD on demand and inventories, I was reading through TIME, they mention how everyone has already bought everything they need, computers, SUVs, DVDs, etc.. The market is saturated with cheap goods. And, the worst part due to increased competition and squeezed margins is, it lasts, it won't break, doesn't need replaced.
Due to globalization, there are so many cheap goods being produced by foreign workers for a few bucks a day, that it can never all be consumed.
I also read from another source how now one can buy quality for less. It used to be that if you bought something cheap, it was cheap and didn't last, not so true today.
IMO, prices, margins, and earnings are coming down further, especially in the PC related market.
I'm all bought out also.
Margin debt is still sky high, and the US savings rate negative, debt to the hilt. I'm afraid this is all going to end badly in stocks.
Just my opinion. |
