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Surely 'all asset classes' can only drop relative to some exception, where is everyone taking their money? I know we have significant inflation, are people goin
by suoduandao2 4y ago
Surely 'all asset classes' can only drop relative to some exception, where is everyone taking their money? I know we have significant inflation, are people going into cash despite it?
- dasudasu 4y agoDoesn’t take much volume to affect the spot price and in turn affect the value of everyone’s portfolio.
- collegeburner 4y agoWell no. Valuations are based at least in part off discounted future cashflows at a very basic level. If projected cashflows drop enough due to bad economic conditions the value of everything will drop. If you think at a basic level there is less capital to return to shareholders via buybacks or dividends. Also the fed finally stopped propping up valuations with QE, money is leaving the economy (about damn time). FWIW VC/PE/some other private stuff isn't actually down yet at least not on paper. But this is bc they are not marked to market very often at all. The reason activity is still good is bc valuations are way down, like half in a lot of cases.
- suoduandao2 4y agoI guess I'm asking "the value of everything will drop as measured by what"?
- collegeburner 4y ago$ and purchasing power, the economy as a whole has been contracting. like if everything is bringing in fewer $ then everything is worth less.
- suoduandao2 4y agoSorry, I'm still confused - isn't everything bringing in 8% more $ than last year?