Slim6
1 week ago
The government is flooding the market with money from out-of-control borrowing. The debt is making new records.
M2 money supply should be no higher than 55% of GDP. M2 should be no higher than $16 trillion. Yet it is rising further beyond $16 trillion, beyond $18 trillion, beyond $20 trillion and now nearly $22 trillion.
Too much money is sloshing around out there, doing more damage each month. Most companies are posting lower net income than prior year.
CAPE PE ratio should be around 15, but we are seeing it about 250% of its value. The S&P 500 CAPE PE is now over 36. We could easily see a 60% drop in indexes, and still these would be overvalued. Beware.