Web Statistics is it time to get out of the stock market 2016 - now is it time to get out of the stock market 2016

Saturday, 24 September 2016

is it time to get out of the stock market 2016 - now is it time to get out of the stock market 2016

is it time to get out of the stock market 2016

Stocks are at an all-time high but the ratio of total market cap to GDP (the Buffet valuation indicator) shows that the entire market is historically overvalued. Should we be worried about the stock market or is this a new era of market calm? Calm before the storm may be a more apt description. fortune lists six reasons we should be worried about the stock market today. The stock market has entered another golden era of supreme calm. Americans are expressing confidence that the big returns equities have long delivered will keep coming, and that the gains will flow smoothly. but if you’re relying on your equity portfolio to pay for your kids’ tuition and fund your retirement, which is pretty much everyone these days, it’s time to get real, and get worried. despite the extreme calm, this could be one of the most treacherous times to dump all your money into the stock market. The main problem according to fortune is over confidence and ignoring the warning signs. Their six reasons to worry about the market are these. really high stock prices together with a s&p 500 pe ratio of 25.5 profits that exceed growth and are unsustainable low interest rates with no room to go lower populist political climate clamoring for more benefits to workers and higher taxes rise of the ultra-right, especially in europe which could lead to political, social and economic chaos low oil prices, market glut and potential for total price collapse leading to a world-wide credit crisis When everyone has decided to get into the market and that prices will go up forever is typically when smart investors hedge their bets or just get out and hold cash. How about Interest Rates and Bank Stocks? The Fed appears poised to inch up on interest rates and bank shares went up. If banks do better with higher rates isn’t this a reason not to be worried about the stock market? The los angeles times writes about bank shares and higher interest rates. banks led the stock market higher monday as investors anticipate that the federal reserve could raise interest rates this year from their historically low levels. that could help banks recover from a long slump by making lending more profitable. But just how high and how fast will rates rise? Our sister site, forex conspiracy report asked where will interest rates be in 10 years? the fed will raise rates as the economy warrants. according to recently published research rates will not go up very fast for quite a while. the fed is heading for a shallow rate path for the next decade and research indicates that ten years from now rates will be one percent higher. the current consensus of fed authorities is 1.5% and there is always the possibility of negative rates if recession re-emerges and the fed needs to reduce rates into minus territory. So, should we be worried about the stock market? It always makes sense to retain a bit of skepticism when seem too good to be true they probably are just that.


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