Now it's the stock market and what's worse is that over the years people have been spoiled to the point of thinking they are "entitled" to it. Lord forbid that someone, the FED no less would pull the plug.
Jim,
I absolutely agree!!
This economy is growing at leaps and bounds, 5.6% annual growth in the last quarter of 1998 alone. Now normally one would think that we would be facing inflationary by now, but we haven't seen it.
What we have seen is the rest of the world going to hell in a hand basket, just like it did in the years before the Crash of '29. The US has attempted to provide the engine of economic recovery and the Fed has primed the financial pump to the point of threatening a loss of confidence in the dollar from overheating the economy.
The next phase will likely be increasing strength in dollar versus everyone else's currency (we're still the island of prosperity in the storm), and a onrush of cheap goods from around the world looking for a market in the last economy standing (we're already in this phase). Should these economies continue to worsen the US will eventually be forced to raise tariffs and protectionism, and that will seal the lid on the coffin of the current version of the global economy.
So the American people have been led to complacency with their savings, and mistakenly created the belief that the stock market is a savings program. "It ain't". But we have to all admit that this market should have crashed and stayed down long ago by traditional valuations. But it hasn't and that has provided some additional time for the opportunists like myself to try to make a few bucks.
Since I can't change it, I will find a way to pick up a few scraps here and there as the financial money powers duel it out.
But eventually, whether it be deflation/depression or inflation/stagflation, the piper will be paid. But I would prefer inflation/stagflation to deflation anyday. Inflation will distribute wealth from the richest to the poorest. Deflation will take it from the poor and give it to the rich as their dollars become worth far more in pricing power.
Regards,
Ron |
