So there's something that's been bugging me lately and Michael Burry article kind of brought it back to me. And I have to preface this with a disclaimer that I have zero education in economics/business or finance. I have an art degree....
I live in an upper Middle Class area in HCOL region and I work in an industry with pretty high wages especially for our blue color employees. So pretty much everyone I know is doing Ok or very Well. And looking around, I see tons of people spending tons of money, there are a lot of construction where older smaller homes are demolished for Mansions to be flipped, my street has lots of Teslas, Range Rovers, MBZ and a Bentley & a Ferrari, stock market is super high in historical terms, etc. And almost everyone I know who has money is stock piling cash for the inevitable "crash" that everyone keeps talking about.
All that makes me think that that are insane amount of money floating around and all investment level assets are in bubble territory. YET, the inflation is staying pretty low... Why is that? Shouldn't feds keeping interest low and some central banks having negative interest same as printing tons of cash?
Only thing I can think of is that all the money is going to the top tier people and maybe middle class and below hasn't made enough gains to push up the prices of everyday items? Hence the price of high cost/investment level items keeps going up such as real estate, stocks, luxury cars etc but not milk/gas etc?
Can someone explain this to me?
Submitted September 04, 2019 at 07:05PM by tO2bit https://ift.tt/2zUvPCR
