With the tech stocks in a funk, and the shares of biggies like Microsoft and GOOGL getting shellacked on Friday, the Dow Industrials still managed to eke out a small gain. This attests to the irresistible power of funny money and its role in keeping the bull market alive no matter how menacing the underlying problems. A week earlier, the broad averages similarly flouted economic reality, rising toward record highs even though earnings reported by the biggest banks were scary-bad. It wasn’t just that the banksters had had a bad quarter, but that their future prospects look as bad or worse.
Only The Government Wins
This is the direct consequence of a yield curve so flat that there’s no longer a profit in playing long-term maturities against short. The most bizarre aspect of it is that there are still investors willing to accept returns as low as 0.5% on bonds that mature 40 years from now. Leave it to the eggheads and their lazy, ignorant lackeys in the press to find a silver lining. Yes, Big Government is saving a mountain of money on interest payments. But even an Econ 101 student could produce a list of many who are getting cheated — including, ultimately, themselves.
Well course they are Jason, this is a chaos created by design–and implemented over time.
The $300 Trillion dollar debt can never be repaid so what are the options? Think it through.
Buy everything “real, as in hard assets” with phony monopoly dollars and then let it crash –blame it on the Ruskies or the Chinese.
You are confusing rationality and illusion.