When the USD is worth less, dosen't it take more of that USD to move the same share? I know the market isn't logical so that's why I'm asking for clarificatation. Seems to me as the USD goes down, the market would go up until people fail to see the value and than tank from the selling pressure and the inflated prices. Thoughts? Added--- I get your point on why foreign investors would jump in now since their currency is worth more than the USD. I'm thinking more about the US participants.
when the USD drops it can cause foreigners to bail. you think they're going to enjoy watching the value of their holdings keep dropping? there's a breaking point that hasn't been reached yet. look at this scenario, stocks start to sell off when foreigners dump US assets, yields on bonds go up, yen moves up, etc. quant funds kick in selling positions and even shorting. now with no limits on shorting only on an uptick this could cause the market to drop even faster than it otherwise would.
Here is a big difference between 2007 and 2000: % Gain in S&P 2000 -10.14% 1999 19.53% 1998 26.67% 1997 31.01% 1996 20.26% 1995 34.11% So, with perfect hindsight it was obvious that people were nuts in 2000 to think that the S&P could keep gaining 20 - 30% EVERY freaking year! Who needed leverage? Where are we so far in 2007? 2006 13.62% 2005 3.00% 2004 8.99% 2003 26.38% 2002 -23.37% 2001 -13.04% Doesn't really look all that frothy does it?
Athlon...you're full of anger dude! Even if they call u names you should roll with the punches & make your point without the vulgarity!
depends, if earnings drop P/E ratios go through the roof. then the markets look overvalued, then the returns would look 'frothy' over that period you can't bubble out of a bubble and expect things to not blow up at some point. the bigger the balloon the bigger the bang.
Dummy, the markets are hardly down. Nasdaq and Spooz flat. There are no comparisons between now and 2000