So stocks now paying 4.2% will be paying 7%?
I don’t think so. The thirst for yield and the need for income will prop up the market. Where are you going to go? Will you take a 2-year CD that pays .9%?
Are you referring to the dividends?
Sadly, it frequently happens that, when a stock tanks, the company's board then also pours salt in the wound by reducing the dividend, as well (which, of course, can result in a positive feedback loop, as the stock price then declines further).
Regards,
I said "Just kidding".
That means, it was a joke. I'll let you figure it out from there.
Exactly!
If you pull your money out of a balanced stock fund now you are guaranteed to lose money because cash won’t keep up with inflation.
With stocks at least you have a chance for some gains.
This isn’t 1929, a total crash of the market would make cash worthless too.
People would find out real quick that the money they thought they had in the bank, the one with the now locked door, was also invested in the markets.
We can all hold the dying dollar.
That should work. /s
Getting 3.5% in a fixed income account at ING. Minimum is 3% no matter where rates go. Nice when you feel the need to dump equities.