He's done it! I would imagine he feels pretty good about himself today, too. He's likely receiving congratulatory calls from his banker friends around the globe. Gift baskets from Dimon and Blankfein arrived earlier this morning, too. The stock market is back to alltime highs! I can hear the popping of champagne corks all the way out here in flyover country.
So what does all this mean? I mean really, what does it mean? U.S. stocks are back to 2007 levels yet millions are unemployed, food stamp usage is double what it was then and the cumulative U.S. debt has been doubled, too. What are we to make of this?
Well, let's try to keep things in perspective. First of all, even if you use the crappy, government-issued CPI, stocks are still 20% below their alltime highs when adjusted for inflation. Sure, your 401(k) balance may be back to where it was six years ago but the value of your dollars and your purchasing power certainly aren't. And again, what about all of those folks who own very few, if any, stocks? (http://www.gallup.com/poll/147206/stock-market-investments-lowest-1999.aspx) How's the "wealth effect" working out for them?
Regardless, let's focus on this wonderful market of stocks and relate it back to the precious metals, which is what primarily concerns us today. First of all, though CNBS is all aflutter with the new stock market highs, maybe someone should show them this chart. Hmmmm. Looks like gold is still a better investment over the past five years, even with the ongoing manipulation. ...