Who is it going to? The vast majority of stock value is held by the wealthy.
I’m thinking this is no longer a productive conversation. You? Let’s drop it.
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they must be doing something with the money
buying real estate
buying art
investing in their company
hosting a several hundreds of million dollar wedding
Yes, rich people spend all their stock gains every year.
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wow
I think you forgot that if a company is buying stock, the buy back is from someone who’s actually selling, and will then have cash.
they’ll be doing something with that cash
You must have added “I’m thinking this is no longer a productive conversation” after I posted my first comment, by the way
My comment about ending the conversation was to jraven. While I disagreed with him, I understood his position. You jumped in without prior input into the conversation that the wealthy are spending all their stock gains on weddings and art. I thought that sort of comment merited sarcasm rather than serious discussion,.but carry on sir.
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a
Dude, you said this to me when I clearly wasn’t talking to you. It wasn’t a private conversation at all, it was your lack of comprehension. Carry on with whatever tangent you want to.
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a
Consumer confidence in stocks is higher than the euphoria of 2000.
Consumer sentiment - how people feel about their own economic outlook - is almost rivaling the 2008 housing recession.
Quite the divergence there.
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Nov 5th is probably going to cause some chaos.
Thats when the SC rules on the tariffs.
I suspect Trump and his minions are going to lose on some of them, so there will likely be an even greater shift to non-US defensive positions (gold, silver, european etc).
To everybody, if you want to have a private conversation, take it to PM. If you post publicly you have to expect that others will reply. That’s even kind of the point.
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Rule on it or hear the case? I don’t think the SC normally schedules the release of their decisions like this, do they?
Hear the case. Based on the arguments and questions from the SC, you should be able to get an initial view of how this is going to go.
The reasoning that they have put in their defense of some of the tariffs is clearly ludicrous, and the vast majority of legal experts agree.
So if SC points to this weakness with their questions, you will certainly see some movement as an immense amount of money (hundreds of billions $$$) would be owed by the US Govt at that point.
There’s an opportunity to slow down the clown show here, with the price still being measured in dollars instead of blood. I’m still not sure (a majority of) the SC considers the latter relevant.
An observation from COVID inflation is that companies have been able to raise prices to offset the loss in value of the USD. If you are an investor anywhere in the world, where are you going to put money (outside of your own country)? US is still the largest economy, but with looking at the finances of the US and Trump in office, why would you put money in treasuries? Too much inflation exposure there. The S&P is becoming a lower risk alternative to the US government as companies will be able to react and raise prices. Investors are going to shrug off bad economic news for a while, and the cost of a recession is still lower than another 10% slide in the USD if a treasury is the alternative.
But thats the thing, there are other options beside t-bills. Non-US investments which are not over-valued (Europe, Asia, Japan) and commodities like gold and various other precious metals.
Right now there are two massive bubbles forming in the US
- AI “Investment” via FOMO which is about 98% useless
- PE/Private Credit leverage
When (1) fizzles out, the S&P 500 will tank because the Mag 7 will not be able to carry the rest of the index.
When (2) pops, you will see lots of insolvencies and bankruptcies. This will hit the investors that put money into private credit (this includes some US insurers)
Won’t be as bad as the dot com crash, or even the GFC, but it will definitely sting the US.
I wonder if people have prejudices against non US investments given perceptions that other places may have less honest financial reporting or a greater value on work life balance or maybe a much older population
Also, why do you imply the Mag 7 would continue outperforming the S&P? Other than Google, they have sky high valuations and Google has its own problems
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The US economy is just less risky than any other economy in the world. When SHTF, the government is willing to prop it up and devalue the currency a bit to keep the economy going. That matters very little to the fundamental value of the economy - prices go up and stocks will ratchet up and everyone moves on. Political risk? We seem to be testing that with Trump right now and the choice has been profits over rights. We had a pandemic, and a financial crisis. What else are you going to throw at the US?
A black swan will still show up (probably AI related), but for now a lot of the traditional risks feel understood.
Speaking of AI…i see stuff out there on how to use Chat GPT to invest. Like everything else, that will work until it doesn’t.