The median worker should be making as much as $102,000 annually—if some $2.5 trillion wasn’t being “reverse distributed” every year away from the working class.
TSP & Vanguard Smart Investor Posts
With 2020 GDP estimates in the 2.0 to 3.0% range, the divergence between Chinese Credit and economic output is unprecedented. China’s “Terminal Phase” excess – including rapid acceleration of late-cycle loans of deteriorating quality – is unparalleled in terms of both degree and duration.
A lot of indicators are doing things they have never done before. And I see this as the result of the central banks flooding the financial markets with liquidity and much of that liquidity ending up in a few companies. Tesla is one of them. It still sits in the TSP S fund which invests in all the non-sp500 companies.
1) Buy and holding regardless of market valuations;
2) Heavily exposed to market risk;
3) Underweight global tech;
4) Underweight the effect of US corporate buybacks;
5) Achieve little diversification with highly correlated funds
Without the restoration of the Glass-Steagall Act, Wall Street’s wealth transfer system, that plunders the 99 percent in service to the 1 percent, will continue humming along.
Why did the Fed do that? Because the largest deposit-taking banks in America are now also the largest trading houses, thanks to the repeal of the Glass-Steagall Act in 1999…
In case you have not heard, there are about 5 companies in America driving the markets. They now make up 28% of the SP500 index (TSP C fund)…
…the safe havens signal a major crisis is unavoidable. This is not your granddad’s Economic Structure. And to hear the Federal Reserve still focused on below target inflation is a farce.
So you might ask why the economy is off-subject for an investing service. That would be because the economy has not mattered to the markets since the Great Recession. And when it does, bad news usually propels the market higher on hopes of more financial stimulus – the real driver.
I seriously doubt China’s banking system inflates from $8 TN to $43 TN during this cycle without Trillions of “Bubble Dollars” flooding the world and its resulting reserves horde. U.S. crisis and QE1 provided China a blank check for a massive $600 billion 2009 stimulus plan. And Chinese Credit – along with investment, manufacturing, apartment Bubble, economic boom, technological advancement, military buildup, global influence peddling, and ambitions for superpower status – never looked back.