> Is stock market going to crash?

Is stock market going to crash?

Posted at: 2014-12-05 
The stock market does not exist in a vacuum. It reflects the strength of the economy and the monetary policy of the Fderal Reserve Bank. Since the Government offers "risk-free" returns by buying Government debt - the investor in the stock market has to consider the alternative - Government bonds and notes. Then there are hard assets - like Gold, Silver, Real Estate, Lumber, Oil etc. which do very well in times of high inflation.

So the stock market "crashes" when the business economy goes soar - falling profits, rising layoffs, falling revenues etc. or the Government abruptly raises interest rates or inflation surges. None of these things is happening now. Profits are rising, interest rates are staying very, very low, unemployment is declining and inflation is not that high - as oil prices are stable or falling. It doesn't mean it can't happen but there are no signs yet.

There is a significant difference between "correction" and "crash".

You can "always" expect a correction. Look at long term (50+ years) of the Dow, for instance, and you see an upward slope, but with plenty of 3 steps forward and 2 steps back (with 4 or 5 steps back, just for fun)

A crash, a drop of 50% or more, happens, but thankfully for investors, rarely. And even though the whole market falls, a few individual stocks may thrive during such instability.

No one surfing this site would have any idea "when" the crash is imminent.

For the last 100 years, many stock gurus have made a "living" predicting "the crash" in the next 18 to 24 months. Great for book sales and speaking (for pay) engagements.

Stock market is the source of investment. It is always moving currency so any time going to crash.

http://goo.gl/BOhXiV

Only if & when the fundamental nature of human greed & human fear suddenly change, and I don't see that ever happening...do you?