Fellow armchair economists....

JohnRo

The problem is that this "bull market" is actually just a protracted, financially engineered recovery from a near total collapse of the global financial system, little if any of it has been felt in what's referred to as the high street in Europe or the US.

There is massive ongoing currency devaluation taking place as evidenced at least in part by hugely inflated asset prices almost across the board. Headline inflation is a construct that seems to bear little relation to most people's daily expenses, which have been masked to a large extent by supermarket price wars and shrinking goods. Commodity prices are depressed as real global growth is flatlining, bad news in the real economy is seen as good news in the financial world. It's difficult to know what's real and what isn't.

I have total faith in a free market sorting all this crap out, but therein lies the problem, central banks and their dependant governments have been allowed to effectively capture and become the market with infinitely expandable purchasing power plucked from thin air, providing support for zombie banks and business that means normal market operation is suspended, financial engineering is the new norm, price fixing and manipulation is rampant, the banks which a healthy free market would have euthanised in 2008 and the criminals running them thrown in the dock, have instead been given a free pass and placed on eternal life support, allowed to continue their toxic activities at everyone else's expense. There have been zero meaningful banking reforms that will prevent it all happening again.

The pressure building is that the tricks and devices imposed and used by the central politburo to dictate and create this so called bull market are unprecedented and appear to be running out of steam, they won't work in the same way they have next time or ever again.

Most people if they're honest know somethings not right about the current financial situation but obviously if you're playing the game when the arrows are pointing up most of the time it's easy to dismiss or ignore the danger signs.

At the end of the day all private investors can reasonably do is diversify and just keep punching through it all, hoping for the better outcome long term. I'm still comfortable in real assets like stocks and shares rather than cash, even with an almost inevitable crash at some point.

Radiantsoul

World economic growth is likely to be 3-4%. No idea what this is likely to mean for investment returns though.

gadgetmind

We're going to muddle through, but this might be the last "kick of the can" for Greece. The rest of "Club Med" also needs to buck its ideas up!

Yes, we're going to see a lot of volatility, but the trigger won't be a known such as Greece, but an unknown such as a major war.

TCA

Some further views here below:

http://www.trustnet.com/News/608514/hochman-expect-a-correction-not-a-bear-market-in-equities/1/1/

gadgetmind

So, the biggest driver for the sell off will be the hike in interest rates that everyone is expecting and has priced in? Interesting.

Thrugelmir

Reaper wrote: »

The anti-EU group seems to think Europe will let us remain in the trading block even if we break all political ties,

The EU needs us more than we need them in trading terms. Particularly for German companies.

Thrugelmir

Hallion wrote: »

What's your prognosis of the global economy over the next couple of years? Is it time to sell your stocks and shares and sit on cash until the next downturn or will you bull ahead and keep investing?

In answer to your question I have no idea. I will continue to look for opportunities as they arise. As there's always somewhere to invest. If you are willing to spend the time researching and buying at the right time. Well run cash generative businesses are always potential takeover targets. So there's always money to be made if one is patient.

Wilkins

Wall St is overvalued but this does not mean it's going to crash anytime soon. When it does, though, it'll take down other equity markets with it.


Little point in predicting, really: just keep diversified and a large wedge of cash, even if that means foregoing some income.