Leading investor: Entire World in a Stock Market Bubble, Waiting to Burst

Discussion in 'Economy' started by JeffWartman, Apr 27, 2007.

  1. JeffWartman
    Offline

    JeffWartman Senior Member

    Joined:
    Jul 13, 2006
    Messages:
    1,309
    Thanks Received:
    101
    Trophy Points:
    48
    Location:
    Suburban Chicago
    Ratings:
    +101
    We need to be careful and remember our fundamental economics...

    http://www.thestreet.com/_breitbart...at=Free&cm_pla=Feed&cm_ite=Feed&puc=breitbart
     
  2. JeffWartman
    Offline

    JeffWartman Senior Member

    Joined:
    Jul 13, 2006
    Messages:
    1,309
    Thanks Received:
    101
    Trophy Points:
    48
    Location:
    Suburban Chicago
    Ratings:
    +101
    Still no acknowledgment of the honest truth: This Dow growth is completely and utterly unsustainable.
     
  3. actsnoblemartin
    Offline

    actsnoblemartin I love Andrea & April

    Joined:
    Mar 7, 2007
    Messages:
    4,039
    Thanks Received:
    407
    Trophy Points:
    98
    Location:
    La Mesa, CA
    Ratings:
    +407
    I thought we should be more concerned with the dollar dropping faster then paris hiltons panties.
     
  4. JeffWartman
    Offline

    JeffWartman Senior Member

    Joined:
    Jul 13, 2006
    Messages:
    1,309
    Thanks Received:
    101
    Trophy Points:
    48
    Location:
    Suburban Chicago
    Ratings:
    +101
    In a time where we have a record trade deficit, that's not necessarily a terrible thing.
     
  5. actsnoblemartin
    Offline

    actsnoblemartin I love Andrea & April

    Joined:
    Mar 7, 2007
    Messages:
    4,039
    Thanks Received:
    407
    Trophy Points:
    98
    Location:
    La Mesa, CA
    Ratings:
    +407
    really, why is that?.

    How come we cant do anything about our record trade deficit?.
     
  6. JeffWartman
    Offline

    JeffWartman Senior Member

    Joined:
    Jul 13, 2006
    Messages:
    1,309
    Thanks Received:
    101
    Trophy Points:
    48
    Location:
    Suburban Chicago
    Ratings:
    +101
    If you read international economics, the first solution to a trade deficit is always to devalue your currency. It makes your exports cheaper to the rest of the world to purchase, bringing the U.S. BOP closer to equal.

    It isn't a be-all-end-all, and it doesn't always work. I didn't say it was a good thing, I said it wasn't necessarily a terrible thing.
     
  7. Diuretic
    Offline

    Diuretic Permanently confused

    Joined:
    Apr 26, 2006
    Messages:
    12,653
    Thanks Received:
    1,397
    Trophy Points:
    48
    Location:
    South Australia est 1836
    Ratings:
    +1,397
    What can I say but great post and I totally agree.

    Okay I've got the sucky bit out of the way :lol:

    Seriously, not that I have a clue about economics, but it's right. I mean, I'm not taking a cheap shot at RSR here (I save my cheap shots for RSR and use them elsewhere) but the Dow has got nothing to do with how the economy works. The Dow going through the roof is not a measure of the strength of the US economy. You may as well compare a tape measure with the quality of the piece of wood that's being measured. The Dow is simply a measure of stock market activity and I would think the stock market right now is hot as a rocket because panic is about to set in about the real state, not the imagined state, not the party-line state, of the US economy. Could it be that frenetic trading is happening because investors are getting in while they can?

    -------------------------------------------------

    Public service announcement:
    This post should not cause a run on any financial institution simply because the poster probably hasn't got a clue. :D
     
  8. JeffWartman
    Offline

    JeffWartman Senior Member

    Joined:
    Jul 13, 2006
    Messages:
    1,309
    Thanks Received:
    101
    Trophy Points:
    48
    Location:
    Suburban Chicago
    Ratings:
    +101
    You're absolutely right; the Dow has no bearing whatsoever on economic strength.

    Secondly, it's even misleading to say the Dow is gaining ground, considering it's really only doing that because of the devaluing American dollar. When measured in any other real asset, the Dow is actually way down and continues to slide. RSR has NOTHING to be happy about right now, but he just isn't smart enough to realize it. They've got him programmed well.
     
    • Thank You! Thank You! x 1
  9. loosecannon
    Offline

    loosecannon Senior Member

    Joined:
    May 7, 2007
    Messages:
    4,888
    Thanks Received:
    263
    Trophy Points:
    48
    Ratings:
    +264
    Jeff I posted this on another board as well. Great article, good lesson.

    I was just reading that the Chinese gummit is becoming a first tier partner in Blackstone corp, a hedge fund that is developing Asian asset funds.

    With 1.2 trillion in foreign exchange reserves to diversify it is already expected that China's emergence in the financial markets will increase the world asset bubble.
     
  10. loosecannon
    Offline

    loosecannon Senior Member

    Joined:
    May 7, 2007
    Messages:
    4,888
    Thanks Received:
    263
    Trophy Points:
    48
    Ratings:
    +264
    The Dow has performed pretty poorly for the last 6 years. It may be one of the few classes of assets that isn't in an extremely inflated condition.

    The flight from what were once the staple of every portfolio (stocks and bonds) does make me a little queasy about the stability of todays markets.

    There is no there, there.
     

Share This Page