The stock market rallied to new highs for the year. Investors are drinking the cool aid with a beer bong – as fast as they can.
The stock market is up 45% this year, but the average earning are down 30% and everything from consumer confidence to manufacturing to employment are headed down. If you cannot smell a rat then put down the cool aid bong for a minute and think about this.
The Fed is printing money faster than any time in history and the budget deficit is closing in on $2 trillion just this year – and Ben says we are on the verge of an economic recovery. Who is he kidding?
There is only one thing that can happen; the stock market is going to crash again. Maybe not today, maybe not tomorrow, but in the near future that market is going to have to correct itself and face reality.
I’m not even sure who is buying stocks? With a 10% unemployment, a steep drop in 401k contributions and many of the big investors still in bonds and the little investors waiting to recover the money they lost last year, who is buying up the market?
My guess is that foreigner investors are buying up the market, hoping to get some good prices on some of the best US companies in the world before the US economic recovery even starts.
That means when the US economy recovers and US companies start making money again, the profits will be going to foreign investors. More money leaving the country.