Clearly many investors are tossing in the towel on stock markets.
Main Street investors haven’t really been involved with global stock markets for a long time unless they’ve just watched their retirement accounts.
Those accounts have grown over the past 7 years as their memories remain just too damn short. The markets have never been a money machine until central banks decided to manipulate prices higher. They did so until their Potemkin fantasy jig was up.
So now Central Banks from China, Japan, Europe, Fed and so forth having their “come- to- Jesus moment” (via the Urban Dictionary: “An epiphany in which one realizes the truth of a matter; a sudden, intuitive perception of or insight into the reality or essential meaning of something; coming clean and admitting failures; realizing the true weight or impact of a negative situation or fact; acknowledgment that one must get back to core values; moment of realization; an aha moment; moment of decision; moment of truth; critical moment; moment of reassessment of priorities; turning point; life-changing moment”).
As I indicated Tuesday, this market is much different than 2008 which was a bursting of the housing bubble, but now we have a multitude of negative situations whether they be geopolitical risks; emerging markets, China, collapse on energy markets, deflation, weak personal income and savings data, outsized global public and private debt, data Middle East, outright lying by government officials regarding just about everything, earnings manipulation via stock buybacks producing income inequality and so forth. Trust is now broken and that in itself is a big deal.
President Barack Obama’s final State of the Union address came up short of the facts on several topics: (Via FactCheck.org)
1. He embellished his record on jobs, citing “more than 14 million new jobs,” without mentioning that’s only private sector jobs and only since the job losses hit bottom in February 2010.
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