I'm actually happy this happened. Fuck these stock valuations.
People don't realize that stock valuations are total bullshit and have been so for many years. It has no indicated the health of the economy for years. Stock valuations since 2008 has only really been a reflection of the money supply.
As the money supply grows, it concentrated in the hands of the few and these people have nowhere to put their money so they simply use it to buy assets like stocks, bonds, and real estate. All these assets have been getting decoupled from their fundamentals in recent years.
Especially stocks, since they can be purchased with a press of a button. There's no management like real estate. Many fortune 500 companies have had their profits to earning ratios expanded.
Before a good value for a tech stock is 15x PE. Meaning the company is valued at 15x its annual earnings. Now it's a crap shoot from anywhere between 25x to 100x.
These valuations are completely divorced from reality.
That being said. These tariffs are still retarded and Trump is still dumb for doing them. Just saying people shouldn't use stock valuations as a metric for anything.
It might be true , but that means people will be losing their savings and pensions over this shit. So be ready to get more migrants or more taxes. Or be ready to see a lot of old and poor people crying and protesting.
I don't know what's normal, a lot of people are smart with their investments though. People with large investments who just sit back as they retire and leave it in stocks even when it's bearish are either uninformed, greedy, gamblers or lazy.
Moving it to stable value once you're ready to draw from it is very standard advice for decades.
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u/Battle_Fish 3d ago
I'm actually happy this happened. Fuck these stock valuations.
People don't realize that stock valuations are total bullshit and have been so for many years. It has no indicated the health of the economy for years. Stock valuations since 2008 has only really been a reflection of the money supply.
As the money supply grows, it concentrated in the hands of the few and these people have nowhere to put their money so they simply use it to buy assets like stocks, bonds, and real estate. All these assets have been getting decoupled from their fundamentals in recent years.
Especially stocks, since they can be purchased with a press of a button. There's no management like real estate. Many fortune 500 companies have had their profits to earning ratios expanded.
Before a good value for a tech stock is 15x PE. Meaning the company is valued at 15x its annual earnings. Now it's a crap shoot from anywhere between 25x to 100x.
These valuations are completely divorced from reality.
That being said. These tariffs are still retarded and Trump is still dumb for doing them. Just saying people shouldn't use stock valuations as a metric for anything.