I'm no expert on the stock market, so I have a question.

[Mr.Bill]

With what is going on with what is left of our federal government and with and insane madman in charge, why is the stock market not going down in flames? I know if I had money there I would have bailed out the day after the election in 2016.

[manor321]

1. Who knows

It's kind of ridiculous. The escalating trade wars should be hammering the market.

[Dawson Leery]

2. The market is dishonest.

So long as the GOP is in power, it will remain high. Do not be surprised to see a massive drop if Democrats win congress this Fall.

[edhopper]

15. It usually crashes

under GOP Adminstrations,

It will with this one before HE is gone.

[triron]

23. Yes it performs better under democratic administrations contrary to the myth otherwise.

[ck4829]

24. +1 It absolutely is.

[GusBob]

3. No expert I

Stock buy backs are propping up the market. The fat cats took their tax cuts and are buying stock in their own companies to inflate the value

I think

Also remember the stock market is not the economy.

Read the book "Flash Boys" Wall Street is run by a pack of crooks and Russian IT specialists

[Mr.Bill]

6. Thanks. Good point about the tax cut and buy backs.

I forgot about that. That well will dry up eventually, though.

[True Dough]

8. I agree with GusBob

I believe the 1 per centers who own major corporations and all of their top executives are extremely comfortable pouring their own money -- a lot of which had been sitting on the sidelines for years -- into the stock market because they know Donald the corporate shill has their backs. He is all about lining their pockets, further enriching the already mega-rich. So their billions of dollars are inflating the value of the stock market since they feel shielded.

[lapfog_1]

4. The duopoly of fear and greed

"I've had my money in the market since 2009 and the great recovery... it's been making me money! Yet I'm afraid of Trump and his tariffs and protectionism and possible wars but then there was this corporate tax cut for like $1T dollars and the companies getting the vast bulk of that tax cut are using it for stock buybacks... so the market is still going up!... do I get out or try to make a bit more!"

Fear - Trump is an idiot
Greed - the market is going up because of stock buy backs due to massive tax cuts
Feat - it's a sugar high and we are going to crash
Greed - but I made a lot of money in the great recovery... and it is easier to leave it in the market

End result- where else could I put my money where it would do this well? money markets? Foreign currency? precious metals?

So, until the market crashes...

[safeinOhio]

17. I'm betting on

cash will be king.

In every crash, there are lots of deals.

[Squinch]

5. The tax reduction on the rich and on corporations has allowed a lot of companies to buy

back big chunks of their own stock. This keeps the price of the stock up. But I don't know how long that can last.

I'm with you. There is more bad debt than there was in 2007, we have the tariff bullshit, interest rates are rising. This thing is going to blow. The only question is when

[marylandblue]

7. The stock market is reactive rather than predictive

If you want a prediction, look at the bond market, specifically, the difference between short term and long term rates It's been getting smaller, indicating an economic slowdown in the next year or so. If the spr3ad turns negative, it indicates a recession.

[safeinOhio]

18. Interst and inflation

Have been heading north.

[ronatchig]

9. I think it is because it is

a big rigged lotto machine set up for the tip top elites to trawl wealth from the sweat and blood of labor. Some will point to the retirement funds of various persons and groups but that is a small % of the total volume of funds. Some will speak of capitalization of projects which boils down to the elites having their fingers in way to many pies. It is a money for nothing scheme tilted very much in favor of the overlords.😈
That being said, there is the possibility of cleaning up in the market but is very much buyer beware. There be sharks in the waters.

[IphengeniaBlumgarten]

10. Some pieces of the answer...

1. Even with the disaster that is our present government, there are plenty of well-managed companies that are doing well. Their prices have remained strong.

2. Nearly all American companies have benefitted from the Republican tax cut. It increases their profits and also enables them to buy back some of their own shares -- with fewer shares in the market, the price of such shares tends to increase.

3. Some sectors of business have benefitted additionally from current policies -- health care, pharma, banks, military-industrial complex are examples, I think.

There certainly are industries that are suffering or will soon do so. Tourism. Manufacturers who use raw materials now subject to tariffs. Agriculture.

Yes, this is a time for caution in choosing or sticking with an investment. But bailing out entirely is not something that I would do. YMMV.

[Yavin4]

11. It's been flat all year. It would be going down if not for the buy backs.

As interest rates rise, look for the market to start declining.

[unc70]

12. Interest rates rising to finance exploding debt

That is putting lots of pressure on currency markets, raising dollar versus pound and euro.

[unblock]

13. Many factors

First and foremost, the stock market depends mostly on perceptions of future profit potential of existing companies, especially the big ones.

That means it doesn't necessarily care about good government or democracy or whatever, as long as companies, particularly big ones, can make big profits.

The tax heist and the low interest rates are great for corporate profits and valuations. Bad for America, but good for corporate profits, at least until the crash....


Second, there's too much capital in the hands of too few entities. They don't have much choice in terms of where to put it. Obviously, that money needs to be taxed away and redistributed to poor people, etc., but that ain't happening while Donnie's in office. Instead, we get an asset bubble.

Big businesses and the rich are buying up commodities and smaller companies, driving up prices. Mainly because there's not much else to do with all that money.

So the stock market goes up.

Where else will they put their money?

[doc03]

14. My IRA balance has increased every year since 2009 when I retired but so

far this year I have lost money. The market peaked in January but it lost ground early this year and has never recovered.

[Awsi Dooger]

16. Market has regained most of the post-January loss

Today was a significant loss but the S&P is still up 6.22% for the year, led by technology, consumer discretionary and health care.

As always, it is preferable not to guess, or to be overly biased. Trump wants to believe everything has doubled since November 2016, and posters here want to believe it is down and soon to crater.

http://www.sectorspdr.com/sectorspdr/tools/sector-tracker

[doc03]

27. It's still a loss this year, first time since 2009 for me. I gained

nearly 300% from the bottom in 2009 to the end of Obama's term.

[lastlib]

19. My theory:

As long as the government is in chaos, essentially consumed with itself, neither Congress nor the Traitor-In-Chief is doing anything to hurt the profits of the big corps. So they just chug merrily on along, raking in record profits. Profits going up, stock prices going up accordingly.

This could change significantly if tRumpski's tariffs start hurting American businesses at the bottom line. If we get into a major trade war, you'll see everybody and their brothers bailing out of stocks, and the hard landing cometh.

[Hoyt]

20. No fan of tax cut, but with it or without, buybacks are because corporations have big profits.

And that’s not because of trump. Profits are “propping” up stocks. Obviously, some of the increase is after tax profit. But, when stocks are bought back, that increases tax revenues.

In any event, I hope profits continue increasing so that Democrats can increase taxes and fund healthcare, education, etc.

[Mr.Bill]

21. Well, if things follow the usual cycle,

Democrats will take over right after the republicans crash everything, then spend two terms fixing everything and cleaning up the mess.

[D_Master81]

22. My guess is low interest rates

1) where else can people put their money and make anything? I know my wife's dad took like $40,000 out of the bank and put it in some mutual funds b/c he wasnt able to keep up with inflation with what he was getting on bank interest.

2) i've heard of people borrowing money to invest b/c the interest rate is below the rate of return.

If interest rates ever start to move substantially i expect to see a decent correction in the market.

[ck4829]

25. Stock market goes up, stock market goes down... We shouldn't care either way

[KPN]

26. Lots of available capital that must be put

somewhere because of the tax cuts primarily imo. Some of that is stock buy-backs, some is individual investments by tax cut beneficiaries. These drive prices for stocks up and lead individual small investors to put more of their money in stocks out of what I think is false confidence. In general, I think stocks are currently overvalued — we’ve been in a bull market for a number of years now and that can’t last forever. There’s a lot of mass investor psychology involved. Sooner than later there will be a correction if not another recession or crash. Euphoria can’t last forever.

[NCTraveler]

28. I feel the market has a good year and a half outlook.

Maybe longer but I wouldn't guess past that. There has been a flood of new money at the top with the tax scam. That money is being used in multiple ways, over inflating the market being one of them. Then there is the fact that rents and costs of many goods needed by people are going up dramatically, overall. Money is flat out flowing up. The halves and have nots are being separated further and further every day. They tax scam and false inflation of the market is paying off big for the market.

There are other reasons as well but those are two of the biggest. Money is flowing up. Big time.

[cbdo2007]

29. The stock market is bigger than politics

and ultimately, the people with money in the stock market are running politics, not vice versa. Sure, Trump can make some companies go up or down, but ultimately as long as the market keeps bringing in money, people are ok with Trump wreaking a big of chaos. It's all going to turn out in the end. Things are better off now than they were 50 years ago, and 50 years before that, and 50 years before that, and 50 years before that.