I haven't seen the Stock Market this disengaged from the Economy

[edhopper]

Since the last time a Republican was crashing the country (that would be 2007-08 and GWB, if you were wondering.)

[ret5hd]

1. my layperson understanding:

the dollar is going to shit…better to own “stuff” rather than dollars. That “stuff” may be denominated in dollars, but will possibly be worth SOMETHING even if the dollar dissolves.

look at gold/silver also. Golds over $4000/oz, silver over $50

[edhopper]

2. By what you say

traders should be selling stocks for commodities, but they are still driving up stocks. Part of that is an AI bubble. Part of it is ignoring the signs of a falling Economy. And ignoring the guy in charge is a fucking moron and a thief.

[dickthegrouch]

3. Wasn't 7000 "Irrational exuberance" (Alan Greenspan)?

The stratospheric heights now are very welcome in my retirement accounts, but pure stupidity if Mr Greenspan was correct. I wonder what he thinks of the current 'valuations' (He's apparently 99yo, so I hope he has an opinion still).

[Chasstev365]

4. So what do we do?

T Bonds?
CDs?
Gold?
Swiss Banks Accounts?

Seriously, I have no idea how to protect myself with criminals running the government.

[Oldvet]

6. Get a target retirement fund

Get the one that date matches your target retirement date, and then just don't worry about it. It will automatically allocate the closer you get to your retirement date.

https://investor.vanguard.com/investment-products/list/all?strategy=all_in_one&filters=open

[edhopper]

11. I sold off half my equities in Feb

when TSF took office. CDs getting around 4% right now are good. Gold has soared, so I don't know if now is the time to buy, unless you think the dollar will fall (which it probably will).
I would rather hold on to the assets I have and not worry about missing a big run up, because I am very certain he will tank the economy at some point.

[Oldvet]

5. I'm not surprised about it at all

When it comes to money, put all politics aside for the most part.

Looking at it pragmatically, I can see why the markets are high. Earning are still coming in strong. 2nd quarter gdp ended up being 3.8%. 3rd quarter gdp is projected to be 3.9%. Consumer spending is still strong.

There really hasn't been a reason for them to go down, as long as earrings and spending keep going.

[edhopper]

12. Because the markets are looking back

and not at the sure signs, like new jobs, that signal a coming decline.

[no_hypocrisy]

7. Welcome to 1929 Redux. Same mentality

[BWdem4life]

8. Main difference

They didn't give a f because they knew it was the end of W's term and Dems would have to clean up the mess, while simultaneously being nlamed for it.

Now they just don't give a f about anything because they're all nihilists.

[usonian]

9. It's the AI bubble.

When it bursts, I'm going to buy half of San Francisco.

[Strelnikov_]

10. Paul Krugman had a good article about this a few months ago

https://paulkrugman.substack.com/p/why-arent-markets-freaking-out

So why aren’t markets freaking out? Nations in which central banks lose their independence sooner or later suffer high inflation, especially when they are taken over by autocrats who buy into crackpot economic doctrines. And Trump, who has been demanding large rate cuts because, he claims, the economy is running hot — which almost every economist would say is a reason to raise rates, not cut them — certainly fits that pattern. Yet although there have been small tremors in the bond and currency markets, there have been no significant upheavals in financial markets that reflect the severity of the situation we are in. Throughout this episode, the stock market has remained fairly flat and bond yields haven’t spiked.

...

My read of economic and financial history is that market pricing almost never takes into account the possibility of huge, disruptive events, even when the strong possibility of such events should be obvious. The usual pattern, instead, is one of market complacency until the last possible moment. That is, markets act as if everything is normal until it’s blindingly obvious that it isn’t.

The inimitable Nathan Tankus summarizes this by saying that the market is not, as stylized economic models would have us believe, a mechanism that pools the knowledge and informed judgment of millions of investors. It is, instead, a “conventional wisdom processor.” That is, it reflects views that seem safe to hold because many other people hold them — and the crowd only abandons those views when they become blatantly unsustainable.

John Maynard Keynes said something similar in Chapter 12 of his General Theory of Employment, Interest and Money. Market investors, he argued, pay little attention to the question of what assets are truly worth. Instead, they worry mostly about the market value of those assets a few months in the future. In a memorable albeit sexist passage (it was 1936), he declared that

professional investment may be likened to those newspaper competitions in which the competitors have to pick out the six prettiest faces from a hundred photographs, the prize being awarded to the competitor whose choice most nearly corresponds to the average preferences of the competitors as a whole; so that each competitor has to pick, not those faces which he himself finds prettiest, but those which he thinks likeliest to catch the fancy of the other competitors, all of whom are looking at the problem from the same point of view … we devote our intelligences to anticipating what average opinion expects the average opinion to be.

[edhopper]

13. Good post!