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Is the US stock market bubble the main thing driving the US economic recovery?

Posted on 09 May 2013 with 2 comments from readers

Stock market recoveries typically tend to have a more positive impact on consumer spending than real estate bubbles explains Barclays Chief US Economist Dean Maki who talks to Bloomberg’s Adam Johnson on Bloomberg Television’s ‘Street Smart.’

That’s all very well so long as the US stock market continues to levitate to higher valuations against a deteriorating global macroeconomic backdrop. But does that not also mean the economy will slump again if the stock market now corrects as many expect?

Posted on 09 May 2013 Categories: Banking & Finance, Bond Markets, Global Economics, Investment Gurus, US Stocks, Video Channel

2 Comments posted by readers:

Comment by Bob - 09 May 2013

I am a bear but a very disillusioned bear. I had no idea they could ramp stock pri es so high and for so long.

The real fear now is what to do – jump in and join the markets as they soar higher on fhe back of more and more QE, or is this buying at the market top before a BIG correxction?

How can markets even pause with all this QE. It is scary being a retail investor.

Ed Note: Buy gold, silver and real estate… avoid bonds and stocks. What looks cheap and what looks expensive?

Comment by Bob - 09 May 2013

Thanks – but I am in the UK and house prices never fell. They are much higher now than in 2007. Massive UK bubble that did not burst when the US, Irish and Spanish ones did.

As for gold and silver, I know little about gold but my gut tells me silver has lower to go.

Ed Note: You lost on sterling depreciation instead of house prices!

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