51–60 of 123 posts
TLDR: not very sick, just very short-sighted, panicky and greedy.
So it's made of people.
can someone explain this article? made no sense to me.
Earlier quoted context omitted.
This isn't the place for trolling. From the guidelines: "Be civil. Don't say things you wouldn't say in a face-to-face conversation. Avoid gratuitous negativity." Expressing joy over the suffering of others isn't civil. Lets not turn this into reddit.
But I would also say that in face to face conversation. That is not trolling - I love when markets crash. It was fun during the dot com bust, during worldcom and enron and during 2008 crash. Then watching people do the same mistakes again ...
Say GDP in US is growth 2%, inflation is 3%, and stock market is up 10% a year - where do the extra 5% come from?
can someone explain this article? made no sense to me.
In reality, nothing has been fixed since 2008, and Western economies are in shambles behind the scenes. It's a confidence game. At this point, investors are close to losing confidence, and when they do, a big crash will happen.
Earlier quoted context omitted.
over a long enough time period? yes.
The stock market is less than 200 years old. Let's not make any bold predictions about unbreakable trends when we're talking about time periods up to 25% of the age of the market itself. After all, at one time the conventional wisdom was "No football team who plays their home games in a domed stadium will ever win the superbowl." And there were decades of evidence to support that statistical fact!
Recently in baseball, all 30 teams played on the same day, and all 15 home teams won on the same day. That hasn't ever happened before. Why hasn't it happened before? Not because of how unlikely it is. It hadn't happened before because it hadn't happened before. Because it happened now doesn't mean it's more or less likely to happen in the future. It doesn't mean baseball is changing. It doesn't mean anything. But a long term downward trend in the stock market? Means death for a nation's economy. Even a short term downward trend does significant damage.
Football and the stock market are not as closely related as you may think.
Earlier quoted context omitted.
over a long enough time period? yes.
The stock market is less than 200 years old. Let's not make any bold predictions about unbreakable trends when we're talking about time periods up to 25% of the age of the market itself. After all, at one time the conventional wisdom was "No football team who plays their home games in a domed stadium will ever win the superbowl." And there were decades of evidence to support that statistical fact!
This is why its a pretty safe bet that over 15 year+ time periods that the stock market will go up.
Say GDP in US is growth 2%, inflation is 3%, and stock market is up 10% a year - where do the extra 5% come from?
Say GDP in US is growth 2%, inflation is 3%, and stock market is up 10% a year - where do the extra 5% come from?
First, public companies tend to be very large. They are the companies that grew at the expense of their competitors. Second, the companies in the major indexes tend to be the winner among public companies. Third, a lot of these larger companies expand overseas, sometimes in higher growth emerging economies.
Finally, IIRC, the long-term growth rate of the S&P 500 is 7% or 8% per year. That's about a 2% to 3% premium over GDP growth + inflation. That premium is the "winner" premium.
Earlier quoted context omitted.
The stock market is less than 200 years old. Let's not make any bold predictions about unbreakable trends when we're talking about time periods up to 25% of the age of the market itself. After all, at one time the conventional wisdom was "No football team who plays their home games in a domed stadium will ever win the superbowl." And there were decades of evidence to support that statistical fact!
Yes but that fact doesn't have any scientific basis, it's just pure coincidence. There's no reason why it didn't happen other than the fact that it didn't. The stock market on the other hand, indicates the overall health of the country. It's not a coincidence that it keeps going up as the wealth of the nation goes up. Recently in baseball, all 30 teams played on the same day, and all 15 home teams won on the same day…
I think the parent's ultimate point is that no country (by which I mean under the same constitution, monetary system, or de facto political arrangement) has lasted longer than a few hundred years.
Even if everything seems economically fine right now and for the foreseeable future, at some point all countries and their associated economies go away and are replaced by something else entirely, at which point the stock market index within said structure goes to at or near zero.
You just need to take a longer time horizon than "when I retire".