Stock Market Breaks New Records
Give yourselves a pat on the back, investors! America’s main stock market, the S&P 500, just hit a new all-time high. Amid trade wars and growth slowdowns, many thought this day would never come.
One minute, economists are telling us why markets are already halfway down the gutter and destined for the trash can. The next minute, management teams are chipper in their earnings calls, the Fed has gone quiet, and global superpowers are no longer at each other’s throats. The sooner you realize that nobody can predict a recession, the better!
This bull run correlates with low interest rates, keeping risk cheap and pushing money the way of stocks rather than fixed-income investments and savings accounts. A confident consumer is also to thank, as well as historically low unemployment and robust wage packets.
However, the better things get, the more suspicious investors become. With rates so low and bonds offering zip, a “dash for trash” has started. Investors looking for a juicy yield from safe, fixed-income investments are being pushed into riskier waters.
Economists have made grand pre-crash predictions since the dawn of time, auditioning for the lead actor role in a sequel to The Big Short. However, the stock market has hit thousands of all-time highs throughout its history, so keep your eye on the ball investors!