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"As long as there are huge piles of cash floating around" : is this due to the low interest after 2008? Even still, I would assume stock prices can't exceed a c
by joelbluminator 7y ago
"As long as there are huge piles of cash floating around" : is this due to the low interest after 2008? Even still, I would assume stock prices can't exceed a certain threshold relative to the company's earnings as it won't make economic sense; but if indeed there are no other investment alternatives I guess it does? Maybe just hoarding cash and waiting for a crash is the best strategy?
- thrower123 7y agoThe old chestnut is that the market can stay irrational a lot longer than you can stay in the black trying to bet against it. Keeping money in S&P500 index funds is giving 5-10% returns over the past three and a half years. Bank accounts and money-market funds don't even give you 1% over that period.
- joelbluminator 7y agoIndeed, that's the common investor wisdom. But I have to say it's getting scarier by the day. If you hoard cash or put it in a savings account you risk inflation. If you put it in the market you risk 40% crash is we witnessed twice the last 20 years. You might say bonds but they carry a risk as well as interest rates may pick up at some point. I'm staying in the market but can't say I'm loving it.