Indexes are up because the wealthy were bailed out with the “stimulus”, which was free money printed by the fed and given to people who don’t need it, lead them to just put it in the “market” since again there’s nothing to spend your money on currently other than stocks and real estate, this only leads to higher assets prices.
The fact that the us government took zero equity positions despite bailing out the wealthy will be discussed for decades.
This cycle has definitely a proven point now about how asset prices are a fungible for currency inflation. Every flavour is different though... with this kind of inflation, what what government y prints, government y receives. A central bank handles the deficit, but the asset inflation is global, not limited to a national currency. Probably destabilizing in a game theory sense.
That said, there's also the fact that for amzn, 2020 has really made prospects X% better. X% of amzn makes up for a lot of Y% worse in companies that do worse in a pandemic. There's a definite correlation between company size and prospects in this crisis year.
On government equity, I agree. Macroeconomics needs a do over. I think norway proves the principle of governments owning equity stakes pretty handily.
Incidentally, Norway would probably have been (could still be) an even bigger success case if they adjusted even more boldly. A lot gets lost on regular price inflation.
The fact that the us government took zero equity positions despite bailing out the wealthy will be discussed for decades.
TLDR money printer go brrrrrrrr
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