Discussion » Questions » Finance » Is it true the stock market does not reflect the true health of the economy and the Federal Reserve pumps printed money into it to keep it
O-uknow

Is it true the stock market does not reflect the true health of the economy and the Federal Reserve pumps printed money into it to keep it

afloat and at any time can just allow it to crash?

Posted - April 9, 2018
Tags : None

Responses


  • 17570
    How would it infuse money into the market?  This topic is not my strong suit AT ALL. 
      April 10, 2018 6:34 AM MDT
    0

  • 6098
    It is a category unto itself.  What it reflects are the investments people make in certain companies.  It is not comprehensive. 
      April 10, 2018 7:56 AM MDT
    0

  • 5835

    There are lots of indicators of economic health, and they are all looking rather bleak. One of them is history: every use of unbacked paper money has led to a collapse within 40 years. We are now in the 47th year since Nixon abolished gold backing of the USD in 1971, but this is also the first time in history that printing counterfeit money did not require an actual printing press.

    Yes, there is a shadowy group with the sole purpose of pouring counterfeit money into various markets to keep up the appearance of normality. The indicator of stock health is price divided by earnings, usually called PE. Normal ratio is around 15 and when it gets up toward 30 we start talking about a bubble. Right now it is 24.

    https://www.multpl.com/

      April 10, 2018 6:25 PM MDT
    0