Timothy Birdnow

Despite possibly record high inflation and looming economic disaster the stock market is soaring. Now why is that?

I've been reading a lot of analysis, which swing from the economy is recovering to the public is relieved at the steps being taken by our government. But those are all hogwash, in my view.

Now, the reason is that people are investing more to save their assets. Keeping the money in the bank, or at home, means losing value every day. And investing in government bonds? You would be nuts to put your faith in the full faith and credit of the United States - much less a state or local government.

That leaves only a few options. You could buy land, but land is increasingly expensive, especially since the Chicoms are buying it all up. The average investor would have to take out a loan to buy it - and the interest rates are rising and with inflation you may not be able to pay the loan off.

Or you could buy precious metals. But these make you a target, and with the current refusal to enforce laws it would make you a target. Also, many people are afraid of owning precious metals because they don't really understand them - and because they fear the government may make you turn in your gold or silver just as they did in times past.

So what other options are there? Most investments are in worldwide corporations which can perhaps survive the economic collapse of the U.S. and the value may remain shielded form inflation here. It seems to me stocks are pretty much the only viable option for most.

So naturally the market is up.

it has always been so; the markets go up during heavy inflationary periods.

And when the bust comes (as it always does) the wealthy class is there to pick over the carcass.

Posted by: Timothy Birdnow at 12:15 PM | Comments (3) | Add Comment
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