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It's funny, I've been hearing since at least 2011 that a stock market correction is going to happen any time now. For the past few years I've heard the same thi

It's funny, I've been hearing since at least 2011 that a stock market correction is going to happen any time now. For the past few years I've heard the same thing about housing. But there is so much money out there looking for a return, and so few good places to allocate it, that it is hard to see what the catalyst could be for causing a correction. Obviously things can't go on this way forever though.

im3w1l 6y ago
> it is hard to see what the catalyst could be for causing a correction. If inflation comes and it becomes necessary to raise interest rates, that would cause a correction.
UncleOxidant 6y ago
But there was a rather large correction in both home and stock prices in 2008. That's not so long ago.
- jeffreyrogers 6y ago
  Sure and the catalyst for that was people couldn't afford their mortgages, but current property and stock values are pumped up by an excess monetary supply caused by quantitative easing and a lack of real innovation which would offer actual good investments. Since there is so much cash floating around and no good places to put it, when people have to exit the market new money floods in, keeping asset prices up. In January PE firms had 1.5T cash ready to invest. I'm sure that will get deployed as bankruptcies start to happen.
mdorazio 6y ago
To be fair, the correction was happening in March, and then the government stepped in and basically signaled it would write as many blank checks as needed to prop it back up. 100% agree that there's a stupid amount of money looking for returns with very few places to get them, though.
colinjoy 6y ago
2011 - 9.6 trillion. 2019 - 15.4 trillion. 2020 - 18.3 trillion and growing... (M2 dollar volume)
paulmd 6y ago
> It's funny, I've been hearing since at least 2011 that a stock market correction is going to happen any time now As they say - the market can stay irrational longer than you can stay solvent...

im3w1l 6y ago

> it is hard to see what the catalyst could be for causing a correction. If inflation comes and it becomes necessary to raise interest rates, that would cause a correction.

UncleOxidant 6y ago

But there was a rather large correction in both home and stock prices in 2008. That's not so long ago.

jeffreyrogers 6y ago
Sure and the catalyst for that was people couldn't afford their mortgages, but current property and stock values are pumped up by an excess monetary supply caused by quantitative easing and a lack of real innovation which would offer actual good investments. Since there is so much cash floating around and no good places to put it, when people have to exit the market new money floods in, keeping asset prices up. In January PE firms had 1.5T cash ready to invest. I'm sure that will get deployed as bankruptcies start to happen.

mdorazio 6y ago

To be fair, the correction was happening in March, and then the government stepped in and basically signaled it would write as many blank checks as needed to prop it back up. 100% agree that there's a stupid amount of money looking for returns with very few places to get them, though.

colinjoy 6y ago

2011 - 9.6 trillion. 2019 - 15.4 trillion. 2020 - 18.3 trillion and growing... (M2 dollar volume)

paulmd 6y ago

> It's funny, I've been hearing since at least 2011 that a stock market correction is going to happen any time now As they say - the market can stay irrational longer than you can stay solvent...