After nearly seven years of central bank money printing and near-zero interest rates in the US and Europe, a stock market crash is not only likely…it’s necessary.
About Kris Sayce
So far this year, the S&P/ASX 200 index is down 5.4%. Even factoring in dividends, Aussie stocks are down 1.3%.
Every bond in the bond market is intricately linked. If you can imagine the bond market as a family tree, US government bonds would be at the top.
Interestingly, if you’ve heard of the Rule of 72, you should know that it works with negative interest rates too.
After 40-plus years of cheap money and easy credit, Vern says the Aussie economy now faces a long period of depressed asset prices.
If I had the foresight at the time, perhaps that should have been a warning of what was to come for the Greek economy.
We aren’t ‘perma-bears’. But, by the same token, we aren’t ‘perma-bulls’, either. Instead, we just know that neither bull markets nor bear markets can last forever.
Where the US dominated the world’s economy for all of the 20th century, and most of the 21st century so far, China is on the verge of taking over.
Make no mistake, the currency wars won’t have a happy ending. Years of low interest rates and money printing won’t result in a victory that anyone can be proud of.
While most people think of themselves as long term investors, they actually invest like a short-term investor.
Aussie government debt is now at $364 billion. The government seems to be taking the IMF’s advice. It’s got the green light to spend, spend, and spend...
It says something that of the top 10 biggest movers on the ASX today, not one of them has a share price greater than three cents:
The Fed keeps interest rates close to zero for more than six years, yet the Fed chief seems unaware why bonds and stocks are so high.
You shouldn’t expect the RBA to use high house prices as an excuse not to cut interest rates. Interest rates in the US and UK are much lower.
What’s happening to resource stock prices today is all part of the natural cycle. This is why you should buy low and wait for the cycle to turn higher...