Significant decline in stocks as valuations skyrocket, fed warns!!!

[tsfx]

We voted out a clueless Prez, too bad we can't vote out a clueless Fed.

Why is the FED so clueless ? Or what are they cluesless about ? That they are not raising rates when the market is getting into a speculative bubble ?

Right now we have a very constrained supply while money is still waiting to do something. We can't travel and we can't go out to restaurants - the two that used to take significant amount away from our wallets. The inflation that everybody is talking about is precisely because of those factors. A lot of companies get earnings boost accompanied with the increased appetize to invest the capital that would've just stood somewhere. Word gets out, more people get involved in investing and the ball gets rolling.

What can the FED do ? This environment makes more money chase fewer companies. Let them chase it. Obviously they can't liquidate. Everyone's wealth is on paper anyway. Only few lucky ones will decide to liquidate and go into cash. Once you start cashing out you'll see what price the market is actually capable of giving you. Let the market ride to the moon if it wants to.

Raising rates is absurd in an inflationary environment even though that has been the practice for central banks in the history. Why would you raise prices when prices are already high ?? You'd cause a wide spectrum crash even for those who are not participating in the bubble.

The only thing to do is to revolutionize your approach of how you tackle bubbles without raising rates. And that's something the government needs to do, that's not the job of the FED. Democrats are more famous at "taking from the rich and giving to the poor", let's see if it is the case this time around. The market will find its way to fair value itself once "systemic rate rises" are in action.

You know, it's interesting how lots of people are frustrated by the high prices. You know why that is ? Because your "rational mind" is incapable of pressing that buy button and all you can do is whatch your sidelines cash decline in value. Most of those people desperately want a crash simply because you wanna buy at lower prices. You think the market doesn't know that ?

btw, the market is gonna drop next week

 

[SunTrader]

You assume much .......... and read very little.

Volker was the last FedHead that had a clue.

And this has nothing to do with the "price of tea in China". Google it umm the expression not the actual price.

 

[tsfx]

You assume much .......... and read very little.

I guess...

 

[SabreMan]

Fed warns about potential for ‘significant declines’ in asset prices as valuations climb

Cant say the Fed didnt warn the Longs. They knew obviously new the inflation before hand.

 

[piezoe]

So our weak/fragile economy that relies on massively rising debt & keeping interest rates over 5,000 years of human history may unwind in a tragic way. The ignorant Fed just now figured out what is obvious to anyone with a clue.

actually there is no public debt, if that's what you're referring to by "debt". There are other serious concerns of course, but so-called "public debt" should not one of them.

 

[comagnum]

actually there is no public debt, if that's what you're referring to by "debt". There are other serious concerns of course, but so-called "public debt" should not one of them.

* CBO is the nonpartisan Congressional Budget Office.

https://fee.org/articles/new-report...wed-over-young-people/?itm_source=parsely-api

 

[piezoe]

* CBO is the nonpartisan Congressional Budget Office.
View attachment 258771


https://fee.org/articles/new-report...wed-over-young-people/?itm_source=parsely-api

I know. The CBO thinks that the aggregate deficit is debt. But the deficit isn't owed to anyone, and the bonds sold are exchanged for money already printed out of thin air and spent into the private sector. If you had a money machine in your basement the concept of debt would be meaningless to you as well. Neither you nor I can print money whenever we want to buy something, but our government can. The important thing is how much money is created over time relative to productivity. And another long term concern, I believe, should be bond servicing, which we call "debt servicing" which is non-prefunded, non-discretionary spending.

 

[vanzandt]

btfd.

 

[Relentless]

btfd.

I'm gonna go with STFR.

Even if markets make a run at new highs this year after this correction it's unlikely they will supercede or even get back to original ATH's.

 

[piezoe]

I'm gonna go with STFR.

Even if markets make a run at new highs this year after this correction it's unlikely they will supercede or even get back to original ATH's.

Wouldn't that really depend on how fast all of this new outside money finds its way into circulation in the economy. We should see a tremendous boost on the demand side, and some considerable inflation until the supply side can catch up. Overall there should be full employment and a really roaring economy with a big gain in GDP by fourth quarter 2022. I would expect we won't see it reflected in the economic reports until mid 2022, at the earliest. But the markets, I would think, will reflect anticipation of a roaring economy. Although I have to say I don't really know how all these new stock market participants (the robinhood folks) will respond. As neophytes, they may just be anticipating getting rich quick and will panic at the first signs the market looks like it is tanking. Should be interesting.