Mish's Global Economic Trend Analysis Message Board

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Strategies & Market Trends : Mish's Global Economic Trend Analysis

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To: mishedlo who wrote (104403)	11/18/2009 7:19:50 AM
From: Dan3	3 Recommendations Read Replies (1) of 116555

Re: The PE is at nosebleed levels, banks aren't lending and the recovery consists 100% of govt stimulus and complete fools who think there is a recovery. The problem is that PE is no longer relevant to the market, which is a bigger problem. Since the market is now operating off of - something else - "real" measures don't seem to matter any more. Since economic fundamentals don't seem to be driving the market, the externalities that are, (FED funded bubbles) could drive us to inflation as easily as they could drive us to deflation. You keep dismissing Weimar style hyperinflation as an impossibility, since fewer and fewer people have jobs and those that do are seeing their disposable income eaten away by local taxes and health care costs. But this may have been destroying productive capacity even faster than it's been destroying purchasing power. The amount of money the FED seems to be willing to funnel to its cronies looks to be infinite. That throws off the ability of logic and reason to predict the market.

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