Classic example today.
A dreadful jobs report in the US (the US added 96k jobs in August, but needs to add about 150k a month to stand still because of population growth), and the past 2 months data revised downwards, and yet stocks, after a small jump down, climb higher because, surprise surprise, it increases the chances that the FED will print more money next week.
Dysfunctional financial markets
Classic signs of a bull run: -
Slowing inflation, slowing employment, falling commodity prices, poor GDP figures, rising inflation, rising employment, rising commodity prices, good GDP figures.
Classic signs of a bear run: -
Slowing inflation, slowing employment, falling commodity prices, poor GDP figures, rising inflation, rising employment, rising commodity prices, good GDP figures.
Slowing inflation, slowing employment, falling commodity prices, poor GDP figures, rising inflation, rising employment, rising commodity prices, good GDP figures.
Classic signs of a bear run: -
Slowing inflation, slowing employment, falling commodity prices, poor GDP figures, rising inflation, rising employment, rising commodity prices, good GDP figures.
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CaerMyrddin
- Posts: 1271
- Joined: Mon Sep 07, 2009 10:47 am
Imho, the market rallys because investors are afraid the FED prints more, you'd be better holding stocks rather than cash on a high inflaction scenario...
One thing is clear, since the Japanese crisis nearly 20 yrs ago (after Japan was held to be the model of how things should be) things have never got on a fully even keel. However QE isn't necessarily inflationary
It's not just the supply of money, which tends to be reduced by reduced lending/borrowing, it's it's speed of circulation and it's pretty sluggish at the moment with vast quantities being held as savings by induviduals and comanies not to mention sovereign reserves like China.
It's not just the supply of money, which tends to be reduced by reduced lending/borrowing, it's it's speed of circulation and it's pretty sluggish at the moment with vast quantities being held as savings by induviduals and comanies not to mention sovereign reserves like China.