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Stocks are up because there is so much money around these days, and not a lot of places to put them. Bonds aren't paying, so don't put them there. Where else do
by megaremote 7y ago
Stocks are up because there is so much money around these days, and not a lot of places to put them. Bonds aren't paying, so don't put them there. Where else do you put your money?
- wheelerwj 7y agoThere's also a tremendous amount of stock buy back happening, which means less money is being distributed to investors and more is being used to prop up the prices. There's plenty of other places to put money though.
- ThrustVectoring 7y agoStock buybacks are a way of distributing money to investors. It's functionally equivalent to a dividend.
- BubRoss 7y agoStock buybacks give money to investors but are taxed as capital gains and not income.
- alasdair_ 7y agoThe whole point of stock buybacks is that they are the same as paying a dividend but the tax impact is much better. I’d prefer that all stocks did a buyback instead of paying a dividend.
- rayshan 7y agoWhy not keep a good chunk of cash around? During the 2017 ~ 2018 financial crisis, 1331 out of 1363 midcap+ stocks lost money. It was a great time to buy undervalued stocks that eventually benefitted from the longest recovery period ever, still going strong today. Even AIG, the villain that caused the crash and was bailed out by the government, was one of the top performers during the recovery. If you're curious, here's the full stock performance dataset I pulled for the last recession: https://shan.io/writing/learnings-from-the-2008-great-recession/#your-turn-find-hidden-gems-in-the-complete-raw-data https://shan.io/writing/learnings-from-the-2008-great-recess...