Hi Eva. The fed is pumping 85 billion a month in new money. Interest rates on treasuries are near zero. The money ends up in equity markets by the big players because all money is fungible. It costs the banks virtually nothing to borrow money and that money finds it’s way into the equities market. That’s called a bubble and once the fed takes the air out of the bubble it will collapse on itself. By then the smart players will have moved their money back into cash and safe havens. The mutual fund investors will take a bath and life will continue on it’s inevitable way. The rich will get richer, the middle class will be raped by government and the takers will be oblivious as always.
“Hi Eva. The fed is pumping 85 billion a month in new money. Interest rates on treasuries are near zero. The money ends up in equity markets by the big players because all money is fungible. It costs the banks virtually nothing to borrow money and that money finds it’s way into the equities market. That’s called a bubble and once the fed takes the air out of the bubble it will collapse on itself. By then the smart players will have moved their money back into cash and safe havens. The mutual fund investors will take a bath and life will continue on it’s inevitable way. The rich will get richer, the middle class will be raped by government and the takers will be oblivious as always.”
Post of the week.
It all makes me very nervous. We narrowly avoided the last stock market crash, by withdrawing our money just days before it hit, thanks to a guy who was looking for our business as a financial advisor. We have since parted with him, but he sure was right that time.
I don’t know if you saw a post that I’ve made a few times lately, that they have added a new line to the Social Security form, asking how much money you and your spouse have in your 401Ks or IRAs. I am told that the question is not on the on-line form, so I am going to fill it out on-line, rather than the paper version. But from what I have read, the Obama administration is contemplating taking over 401Ks and IRAs and investing them in treasury bonds, to pay out in the form of a pension or annuity. We have been hearing about this idea since 2008, but it seems a lot closer to fruition when you see the question on the Social Security form.
The other possibility to explain the question is that there is talk that all Medi-care will be rolled into Medicaid when Obamacare becomes fully implemented and anyone with a 401K or IRA will not qualify, unless they turn over the funds to the government to be doled out as the government sees fit.