“The market can stay irrational longer than you can stay solvent.”
“The market can stay irrational longer than you can stay solvent.” - John Maynard Keynes
Just some samples of crazy, irrational behavior:
10-Year Treasuries UNDER 1.5% - people clamoring to guarantee losing money to inflation.
Jobs Report - best in 4 years, and the market Tanks (7/12/2012).
Single-digit forward P/E Ratios are called "Expensive" by so-called "experts".
Companies flush with cash are not buying back shares - looking for better "opportunities"
And, in the worst recession since the Great Depression, made worse by a President who, despite spending over $1 Million per "job" and having the # of jobs go DOWN and not UP, gets a 50% Approval Rating.
Crazy, Irrational, and absolutely NOT something a reasonable investor can figure out. Who knows if this is the "new normal" or if rationality EVER returns to these markets. What the markets are telling us today though is this (Note this is what IS happening, not what SHOULD happen):
Interest Rates always go down.
Stocks always go down over time.
Unemployment always goes up.
You can spend money you will never be able to pay back. And if the economy gets worse as a result, you can spend more.
There is always another "Bailout" if you fail (unless you are an individual investor/homeowner/worker).