I agree, if I were prudent I'd not have any money at all in the stock market, or at least significantly less (am now at 2/3d's should be between 50 and 0 (maybe Grahams classic approach "minimum 25 %"?) however, 10 % is short you guys' different stock markets, so that's gives some hedging at least).
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Talked to a guy "in the markets" the other day.
First of all, he didn't understand that the money for QE comes from nowhere. (And he's pretty advanced in his economic niche, albeit slim.) "No, then it would be hyperinflation". "Right...?" I said. "Of course. There's no way that that is true", replied this guy, quite confident in his own judgment.
That just made me realise that many people have no idea how bad it is. Most people don't really think about these things. And when you give a handful of academic economics the power to do some experiments with the central banks and the world economy, without the proper checks and balances in place – well... let's just say, imbalances tend to occur here and there.
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The valuations, sure, that too, but the main thing is that everything – all the "stability" – that they rest on are about as thick as a piece of paper. Then, of course, it doesn't help that they're sky high, either.
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However, there's always some picks for the small guy, and who knows, this mania may continue for a while... If nothing that has happened so far can knock markets, I don't know what will, except the default of US or other major state. Which, in my mind, is not at all impossible. |
