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I thinks it's just way too much liquidity sloshing around. I'm guessing we're going to see a more volatility in prices in future. A tip in any direction of an a

I thinks it's just way too much liquidity sloshing around. I'm guessing we're going to see a more volatility in prices in future. A tip in any direction of an asset class will cause money sloshing into it and out again at the first sign of trouble. That's just a guess. I think the text book answer of equivalent of this is just hyperinflation (except that's when the money starts flowing into real price of goods and services)

taneq 7y ago
I think you're right. What we've been seeing for the past 10+ years with wages and real-world earnings staying about the same isn't some weird effect on salaries. It's rapidly dropping goods prices (which everyone's been asking about - why aren't prices of basic goods dropping?) due to globalisation, automation and economies of scale, combined with hyperinflation.
- tdfx 7y ago
  There's been some discussion that wages haven't actually been flat at all, just take home earnings. The difference is theorized to have been siphoned off by rapidly increasing health insurance premiums [1]. [1] http://laborcenter.berkeley.edu/health-care-costs-under-job-based-plans-have-grown-rapidly-while-wages-remained-flat/ http://laborcenter.berkeley.edu/health-care-costs-under-job-...
ethbro 7y ago
I'm curious what the end effect of reducing retail trading fees to $0 at online brokerages will be. I think (?) retail isn't much of the overall market, but it certainly seems like it would increase the agility of retail investment flows.
- raincom 7y ago
  Retail won't move the overall market. However, it can move meme stocks like TSLA, SPCE, etc.
snarf21 7y ago
Right, this is just a dead cat bounce. A lot of people are trying to time the bottom. All of FAANG will be in even better shape post crisis. Additionally, the money has to go somewhere, and people are chasing returns at any cost.
riazrizvi 7y ago
Or highly leveraged short-selling. Institutional insiders with an information and speed advantage drive bids to test the strength of selling. Highly leveraged positions can only tolerate small losses before they have to stop out. If that is a widespread market position you get these weird market movements in the opposite direction to what makes sense, because closing out of a big short position while the price is going up, just drives the market higher and higher.

taneq 7y ago

I think you're right. What we've been seeing for the past 10+ years with wages and real-world earnings staying about the same isn't some weird effect on salaries. It's rapidly dropping goods prices (which everyone's been asking about - why aren't prices of basic goods dropping?) due to globalisation, automation and economies of scale, combined with hyperinflation.

tdfx 7y ago
There's been some discussion that wages haven't actually been flat at all, just take home earnings. The difference is theorized to have been siphoned off by rapidly increasing health insurance premiums [1]. [1] http://laborcenter.berkeley.edu/health-care-costs-under-job-based-plans-have-grown-rapidly-while-wages-remained-flat/ http://laborcenter.berkeley.edu/health-care-costs-under-job-...

ethbro 7y ago

I'm curious what the end effect of reducing retail trading fees to $0 at online brokerages will be. I think (?) retail isn't much of the overall market, but it certainly seems like it would increase the agility of retail investment flows.

raincom 7y ago
Retail won't move the overall market. However, it can move meme stocks like TSLA, SPCE, etc.

snarf21 7y ago

Right, this is just a dead cat bounce. A lot of people are trying to time the bottom. All of FAANG will be in even better shape post crisis. Additionally, the money has to go somewhere, and people are chasing returns at any cost.

riazrizvi 7y ago

Or highly leveraged short-selling. Institutional insiders with an information and speed advantage drive bids to test the strength of selling. Highly leveraged positions can only tolerate small losses before they have to stop out. If that is a widespread market position you get these weird market movements in the opposite direction to what makes sense, because closing out of a big short position while the price is going up, just drives the market higher and higher.