The stock market has reached a five year high. Congratulations: it took five years to regain your investment levels from five years ago (not considering inflation). In this same period of time, the price of gold has more than doubled and silver has tripled. But the question is simple: how successful is a party if no one shows up? In this case, the personal investor segment of the stock market has fled. POMO, manipulation and banks as outlined below are the source of this “rally”. So who is smarter, the person who voted for entitlements at the expense of our children’s future or the people who believe that America is on the path to recovery?
A Rally Without Investors And Other Musings
As it turns out, the investing public doesn’t take kindly to the idea that their deposits and their tax dollars (via the Fed’s Treasury purchases) are being used as poker chips. Apparently, they have been slowly indoctrinated by the incremental doses of Keynesian propaganda they receive each time they turn on the TV or read the main stream financial press. As such, they are decidedly unwilling to admit that the glaring contradiction between ICI data which shows some $130 billion in net outflows from domestic equity funds in 2012 and an S&P 500 index hitting all time highs, might just signal that the market is being propped up by something other than good old, healthy grassroots demand from retail investors.