Getbig PHD Economists, help explain something to me.

[El Diablo Blanco]

Economists claim that we are in a recession, yet the stock market is at a record high, a bunch of companies are trading at record highs and have gone buckwild during this so called recession and the housing market is booming, even higher than during the bank scam from 2005-2008.  How is this all possible?

Can you really have a recession, record unemployment, an economy on the brink of a depression yet have record house prices and record stock market?

Something seriously shady is going on and this whole house of cards is going to tumble soon. Are these economists going to claim they didn't see this coming?

[SOMEPARTS]

They papered over the 2008-2009 recession rather than let things fall to true market valuation and things never went back to normal. Because of that nearly everything is fake, distorted or manipulated to look as good as possible to retail investors AKA financial marks. As for the high valuations in equities and housing...the money they've printed that actually got out of the bank to bank system has to go somewhere.

[Megalodon]

[loco]

Economists claim that we are in a recession, yet the stock market is at a record high, a bunch of companies are trading at record highs and have gone buckwild during this so called recession and the housing market is booming, even higher than during the bank scam from 2005-2008.  How is this all possible?

Can you really have a recession, record unemployment, an economy on the brink of a depression yet have record house prices and record stock market?

Something seriously shady is going on and this whole house of cards is going to tumble soon. Are these economists going to claim they didn't see this coming?

Yes.  It happens all the time.



So if we’re in a recession, aka an economic downturn, why is the stock market spiking? The stock market tends to be what’s referred to as a leading indicator of the economy. It’s not a direct, parallel representation of the economy, but it can give a preview of where things may be heading. “Typically the market will start declining before a recession is visible and it will start recovering about four months before the end of a recession,” Jurrien Timmer, director of global macro at Fidelity Investments, tells CNBC Make It.
https://www.cnbc.com/2020/06/11/why-are-we-in-a-recession-if-the-stock-market-is-recovering.html


As for record house prices, mortgage rates have been at record lows in large part because of the recession.  This causes many people to want to take advantage of this and buy property ASAP, which creates high demand and low supply for homes.  Hence, record house prices.

[Flexacon]

Tech companies and mega corporations are booming because they are gaining new customers or old customers are using them more.

Housing market is booming as those who can get mortgages are jumping on them because the interest rate is as low as it will ever likely be.

[Marty Champions]

They papered over the 2008-2009 recession rather than let things fall to true market valuation and things never went back to normal. Because of that nearly everything is fake, distorted or manipulated to look as good as possible to retail investors AKA financial marks. As for the high valuations in equities and housing...the money they've printed that actually got out of the bank to bank system has to go somewhere.

well put stud

[loco]

Tech companies and mega corporations are booming because they are gaining new customers or old customers are using them more.

Housing market is booming as those who can get mortgages are jumping on them because the interest rate is as low as it will ever likely be.

Possibly, but I've been hearing that repeatedly since the 90s.   

[FitnessFrenzy]

Economists claim that we are in a recession, yet the stock market is at a record high, a bunch of companies are trading at record highs and have gone buckwild during this so called recession and the housing market is booming, even higher than during the bank scam from 2005-2008.  How is this all possible?

my opinion:

- record low yields on bonds and cash: Pushing people to invest in the stock market because the other options are worse

- some high flying stocks benefit from the "stay at home" covid economy: Amazon, Netflix etc.

- the FED pumping huge liquidity into the system. It is well known that the broad stock market (e.g. SPX) tends to trade in line with the money supply

- Some covid recession numbers are improving: Weekly US unemployment claims are in a downtrend

- VIX has fallen for a long time (says something about market sentiment)

- SPX short interest is at a 15 year low

[loco]

my opinion:

- record low yields on bonds and cash: Pushing people to invest in the stock market because the other options are worse

- some high flying stock benefit from the "stay at home" covid economy: Amazon, Netflix etc.

- the FED pumping huge liquidity into the system. It is well known that the broad stock market (e.g. SPX) tends to trade in line with the money supply

- Some covid recession numbers are improving: Weekly US unemployment claims are in a downtrend

- VIX has fallen for a long time (says something about market sentiment)

- SPX short interest is at a 15 year low

FitnessFrenzy ain't lying.

[Humble Narcissist]

Nobody knows nothin.

[loco]

Nobody knows nothin.

[SOMEPARTS]

Ptolemy died thinking the earth was the center of the universe.

[IroNat]

“It’s a recession when your neighbor loses his job; it’s a depression when you lose your own.”
― Harry S. Truman

[Mayday]

Economists claim that we are in a recession, yet the stock market is at a record high, a bunch of companies are trading at record highs and have gone buckwild during this so called recession and the housing market is booming, even higher than during the bank scam from 2005-2008.  How is this all possible?

Can you really have a recession, record unemployment, an economy on the brink of a depression yet have record house prices and record stock market?

Something seriously shady is going on and this whole house of cards is going to tumble soon. Are these economists going to claim they didn't see this coming?

The stock market is where the QE flows mostly and the Fed has been open since the GFC that they will keep that up.

Property is in trouble overall. Prices are falling, rents are falling vacancies are rising in major cities. Regional areas are growing as people move away because it's so cheap.   We sold 2 months ago as a result of our risk assesment around covid. Moved out of a very wealthy city area to a wealthy rural area, same as what the super rich did.

[jude2]

Also most of the companies that are suffering are not listed on the stock market. This pandemic has helped the large companies, but is killing the local small ones.

[loco]

Ptolemy died thinking the earth was the center of the universe.

Bogle died wealthy and loved by family, friends, and hundreds of thousands of grateful and happy investors.   

"Jack did more for American investors as a whole than any individual I’ve known" - Warren Buffet

[loco]

It’s not just big tech driving US markets higher

Over the last 12 months the S&P500 has widely outperformed other global markets, and we’ve heard a great deal of how much this strength has been dictated by the FAANG companies of the likes of Apple, Amazon and Microsoft, and certainly looking at the performance over the last 12 months you can certainly see the correlation, however that’s not the whole story, as we look across at a whole host of other US stocks that have seen some face ripping gains so far this year.

What was particularly notable was how the gaming and collaborative technology basket outperformed in the broader sell-off, remaining above the zero line even as the market started to carve out a base. In this example it is important to remember that there may well be some cross over in terms of the constituents of some of these baskets.

To sum up while the likes of Big tech has hogged the headlines, in terms of the current market rally, it’s been the performance of some of the smaller cap stocks that has also helped drive this bandwagon, along with the likes of certain parts of the US retail sector which saw which way the wind was blowing almost ten years ago and revamped their business models to adapt to the shift to on-line retail.

Best Buy is a perfect example of this, sinking like a stone in 2012, the company was overhauled from top to bottom. The company pulled out of the UK, pulled out of mobile, as well as streamlining its store model in the US, by establishing a store within a store for major brands. The company also improved its online presence and same day delivery processes, pulling it up from record share price lows in 2013 of $11.50, to be trading at record highs now, just below $120.

https://www.fxstreet.com/analysis/its-not-just-big-tech-driving-us-markets-higher-202008251024

[Marty Champions]

The stock market is where the QE flows mostly and the Fed has been open since the GFC that they will keep that up.

Property is in trouble overall. Prices are falling, rents are falling vacancies are rising in major cities. Regional areas are growing as people move away because it's so cheap.   We sold 2 months ago as a result of our risk assesment around covid. Moved out of a very wealthy city area to a wealthy rural area, same as what the super rich did.

your right except rents steadily go up they never go down.

[Humble Narcissist]

your right except rents steadily go up they never go down.

Supply and demand.  They will go down if no one can afford the current price.  Vacancies don't bring in cash.

[Mayday]

your right except rents steadily go up they never go down.

I was talking in reference to today's climate. Most major cities are hurting in pricing and rents.

We pay 4,000/mth rent for an apartment while our house is getting built. That is a 9% discount over what it should be. The renters i know personally all have discounts since covid. Our CBD office was offered a 40% discount for a 12mth lease but we declined, moved it closer to home and pay 75% less.

Commercial space is going to get a skullfucking of Biblical proportions.  Remote working is the key driver as companies will choose a remote workforce and take the cost saving from having less fixed infrastructure.  I was ahead of the curve on that as i pulled my business unit from an office to work remotely over a year ago.

[oldtimer1]

Economists claim that we are in a recession, yet the stock market is at a record high, a bunch of companies are trading at record highs and have gone buckwild during this so called recession and the housing market is booming, even higher than during the bank scam from 2005-2008.  How is this all possible?

Can you really have a recession, record unemployment, an economy on the brink of a depression yet have record house prices and record stock market?

Something seriously shady is going on and this whole house of cards is going to tumble soon. Are these economists going to claim they didn't see this coming?

All that needs to be done to set this economy on fire again is for Blue states to end the shutdowns. Problem sovled.

[mental_masturbator]

Yes.  The stock market’s performance is unrelated to the general health of the “real” economy.  Some articles for more information as to why this is so:

https://www.wsws.org/en/articles/2020/08/18/appl-a18.html
https://www.wsws.org/en/articles/2020/08/14/pers-a14.html
 
Book recomendation:
https://store.counterpunch.org/product/killing-the-host-digital-book/
https://michael-hudson.com/2017/02/j-is-for-junk-economics-a-guide-to-reality-in-an-age-of-deception/

[IroNat]

The stock market is going up because there are no profitable alternatives for the pension funds and institutional investors that now drive the market.  Fixed income investments return zilch. This is a direct result of current monetary policy to keep interest rates near zero.

[Mr Anabolic]

The stock market is going up because there are no profitable alternatives for the pension funds and institutional investors that now drive the market.  Fixed income investments return zilch. This is a direct result of current monetary policy to keep interest rates near zero.

Trillions and trillions pumped in to keep it all propped up.  Totally fake.  No true price discovery. 

The coming crash should be stupendous. 

[IroNat]

Trillions and trillions pumped in to keep it all propped up.  Totally fake.  No true price discovery. 

The coming crash should be stupendous. 

These markets can run up for years.  If you stay in cash inflation will kill you.