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Foreigners don't need to own fixed-interest securities. They can also invest in other US assets, such as the stock market. That's quite a good inflation hedge,
by skybrian 10mo ago
Foreigners don't need to own fixed-interest securities. They can also invest in other US assets, such as the stock market. That's quite a good inflation hedge, so long as the US remains a good place to invest.
- fakedang 10mo agoExcept, apart from tech, there is no good place to invest in the US, especially given the headwinds in the current macro environment. And tech is super overvalued now. There's a lot of investor capital moving to traditional industries in China, India, Brazil, Korea and Europe, simply because there's better returns to be made with more resilience to American problems.
- skybrian 10mo agoAre these places you'd want to invest? I think the S&P 500 is a better bet.
- fakedang 10mo agoRemove the top 7 companies in the S&P 500 (which are all extremely overvalued anyways), and you'll find a very unhealthy S&P. Take into account American dollar devaluation and even the most laggardly of these markets (Europe) outperforms the S&P500.
- cudgy 10mo agoRemove the top 7 companies in the S&P 500 (which are all extremely overvalued anyways), and you'll find a HEALTHIER S&P.
- fakedang 10mo agoBut a non-performant one. Kinda like a bodybuilder who looks buffed AF from the outside but the doctor knows he's completely roided out.
- cudgy 10mo agoInteresting. I like your body builder example, but I believe it more accurately describes the top seven fluff stocks. Valuation matters and just cause the stock is growing (according to estimates) doesn’t mean it’s worth buying. There are other factors like dividend yield and actually making real physical products that people really want, instead of a circular market dominated by a few players that essentially buy and sell products to each other using debt and rounds of vc capital that is constantly hyped up by media darlings.
- fakedang 10mo agoBut that was my point - in spite of the best efforts of the other companies and the other industries, they are continually failing to raise additional (largely American) capital because everyone is just looking at the buffed 7 and maybe some MAGA-backed companies.