OhNoNotimAgain wrote:odysseus2000 wrote:All of these arguements assume that what happened decades ago is what will happen again.
There has been a huge increase in productivity and personal wealth like nothing ever before and that process is on going.
Regards,
No, we have just experienced a massive amount of money printing and interest rates at zero.
UK productivity has not risen.
https://www.reuters.com/business/weak-i ... 20(Reuters),new%20research%20published%20on%20Monday.
Correct.
A lot of the returns we have seen across paper asset classes has been the result of financial engineering instead of real increases in productivity and viable long term businesses.
Companies buying back stock.
"Investment" in housing.
Debt used for consumption.
One interesting metric to see is the proportion of zombie companies in the S&P - typically this falls during periods of economic expansion and then spikes when we have a recession, and this is a pattern we saw all the way up until 2013 when, for the first time in history, the proportion of zombie companies increased even as the economy continued growing all the way into 2021.
I'm not saying that something fundamental hasn't changed so that justifies a higher proportion of zombies - maybe it has, but the trend is alarming and probably hints at financial wizardry that will need to unwind at some point.
Mike Maloney's recent vid went into this:
https://www.youtube.com/watch?v=FKYx3ePSBRw