Fictionally... I am selling a special contraption that earns $10,000 each year. Will anyone buy my device for $200,000? You will regain your purchase price in 20 years. Did I mention the yearly earnings is not a guarantee and not in cash? 
This is the type of deal being bought and sold today on stock exchanges around the world today.
Yeah... But... the price of this device has been going up and up... and up for many years. I can sell it tomorrow for more than I buy it for today.
Or not?
The point is, many markets are not based on traditional fundamental analysis. Gambling based on past performance is the game. This sounds like the market environment of the 1920’s. High times!
Also, like the 1920’s, many people are gambling with borrowed money. The slightest loss of confidence can trigger an instant collapse.
And, the market moves faster now. Much faster! A worldwide collapse can happen in the time it takes to read this post.
Then a bounce. Another crash. Another bounce.
The economic ice seems very thin based on old fashioned measurements. I am not skating any more this year.
Here is today’s beauty.
P/E is a very basic measure used to understand a stocks value, but when people start to "justify" insane P/E ratios they start saying that the P/E jsut doesn't matter like it used to. This statement has been made by many of the talking heads on TV and on many investing blogs.
The rate of margin buying has increased drastically which is very scary. With margin buying if the price drops you can get margin calls and forced sales. These now happen instantly and without hesitation at current bid price. This is why this is such an important factor to watch and understand. The instant nature of these trades and the automatic accepting of the bid price means the price drops further.
A stock market crash is coming and I've recently removed 100% of my stock exposure.
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This is what I have been hearing more and more often. There are no markets anymore just gambling houses run by the central banks of the world which remember are owned by the big banks of the world and not any governments, Have a great day and some day this to will fall apart as it did in the 20's.
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very good words, and great photography!!!
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I like your analogy. People don't seem to understand P/E ratio. Then add in the fact some stocks pay dividends while others do not (Walmart v. Apple).
Stocks can be very shaky to the newcomer.
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Haha I thought you were talking about bitconnect there for a second. If you want to see what you're talking about happen in record time just do some research on bitconnect.
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I agree with you. Well writing sir.
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@doctorjohn
After today. I should join you in not participating any more.
But, I likely will. Futures are a little different than the stock market.
Your money can disappear much faster. Ugh on that.
Francis
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