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wilkommen | 17 days ago

Idk how people write posts like this anymore. Clearly the stock market isn't rational, and prices of stocks are not tied to financial fundamentals. Stocks are essentially a deflationary alternative currency that only people with disposable income can afford. The rich (and to a smaller extent, the middle class) take the currency which devalues every year (USD) and use it to buy the currency which increases in value every year (stocks and other digital assets), and this is part of the funnel that increases the wealth of the rich at the expense of the poor and middle class. People who think valuations of stocks are tied to fundamentals are smoking medical-grade copium. I too wish that the backbone of our financial system was a not a corrupt, rigged game that benefits a small and decreasing number of people every year, but it is.

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WalterBright|17 days ago

> Clearly the stock market isn't rational, and prices of stocks are not tied to financial fundamentals.

Stock prices are tied to anticipated future earnings, not past or present financials.

> only people with disposable income can afford

Anyone can invest in stocks with $100 or less. As for disposable income, anyone that can buy beer, drugs, or lottery tickets has disposable income that can be invested in stocks.

> part of the funnel that increases the wealth of the rich at the expense of the poor and middle class

Corporations make money by creating wealth, not "funneling" it from other people.

bpt3|17 days ago

The numerous downvotes on this post containing basic statements of accepted fact is one of the more concerning things I've seen online in some time.

tastyfreeze|17 days ago

The way to fix that is to stop debasing the currency.

I stopped buying stocks a few years ago. The moment there is a contraction of credit or circulating currency we will see a 1929 style crash. Not worth the risk anymore.

wilkommen|17 days ago

I think in the short to medium term, they will continue expanding the availability of credit and expanding the money supply when crashes happen in order to keep asset prices high. At some point there will be a breaking point, but I think 2009-style "Quantitative Easing" and 2020-style fiscal spending can and will happen again. So I'm still in, but this game won't last forever.

yks|17 days ago

What does "contraction of circulating currency" look like in the post-cash world?