Bernanke merely hints at the end of easing, Dow drops 200 points (Corporate Profits, economic)

[LordBalfor]

Originally Posted by VTHokieFan

Austrians 1

Keynesians 0

Uh-huh, surrrrrrrre


Ken

[VTHokieFan]

Originally Posted by LordBalfor

Uh-huh, surrrrrrrre


Ken

One benefit, though, is that commodities are going to plummet so yay for low gas prices.

[LordBalfor]

Originally Posted by VTHokieFan

Because Austrians preach that our market was floating on a bubble, that the fundamentals of our economy and corporate earnings don't substantiate the ridiculous returns the market was getting, and finally, that it was all based on the funny money printed by Ben Bernanke

Keynesians didn't.

The market move of the last couple of days was an "emotional" reaction - as such corrections usually are.
The market has gained a lot over the last few months and was due to for an adjustment - that's all it was.
It'll be a short-term downward move and then the market will resume it's upward march.

Ken

[VTHokieFan]

Originally Posted by LordBalfor

The market move of the last couple of days was an "emotional" reaction - as such corrections usually are.
The market has gained a lot over the last few months and was due to for an adjustment - that's all it was.
It'll be a short-term downward move and then the market will resume it's upward march.

Ken

Why will it resume its upward march?

[LordBalfor]

Originally Posted by VTHokieFan

Why will it resume its upward march?

Because the economy continues to improve (whether YOU think it's improving or not is not really relevant - it's what INVESTORS as a WHOLE think).

You folks keep claiming the only reason the stock market rose is because of QE - yet the P/E ratio is pretty reasonable (it's a little high for the current stock prices but not hugely so), indicating that company profits are pretty darned good and that as a whole companies are doing well - hence the rise in stock prices over the past few years.

Ken

[VTHokieFan]

Originally Posted by LordBalfor

Because the economy continues to improve (whether YOU think it's improving or not is not really relevant - it's what INVESTORS as a WHOLE think).

You folks keep claiming the only reason the stock market rose is because of QE - yet the P/E ratio is pretty reasonable (it's a little high for the current stock prices but not hugely so), indicating that company profits are pretty darned good and that as a whole companies are doing well - hence the rise in stock prices over the past few years.

Ken

So the economy improved enough since 2008 to substantiate, more or less, a doubling of the Dow index?

[LordBalfor]

Originally Posted by VTHokieFan

So the economy improved enough since 2008 to substantiate, more or less, a doubling of the Dow index?

That's what the P/E ratio says.

Ken

[BentBow]

550 points in the last 2 days alone.

Makes you go Hmmmm? when benanke hints of putting the brakes on the printing press.
Was it just a money bubble? POP goes the weasel.

[lycos679]

Originally Posted by BentBow

550 points in the last 2 days alone.

Makes you go Hmmmm? when benanke hints of putting the brakes on the printing press.
Was it just a money bubble? POP goes the weasel.

He wasn't even hinting at applying the brakes. He was only hinting at taking his foot off the accelerator. Still, the dow is up 14% since Jan 1.

[VTHokieFan]

Originally Posted by LordBalfor

That's what the P/E ratio says.

Ken

Are you sure you even know what that means? It's price earnings ratio. All it is is the stock price per share divided by earnings per share. I'm well aware that P/E ratios are overinflated.