A few working theories.
Massive “wealth effect” causing risk assets to surge. The wealth effect occurs when stocks are way up and degenerates peruse markets for greater gains.
Fed and government stimulus which has increased the money supply causing excess risk taking. This is classic inflations and we’re seeing it in RT in the markets.
Low rates. With rates this low, it pays to borrow to speculate.
The ancillary beneficiaries of the soaring market, presently valued at near $60 trillion, is the surge in cryptos and other non-traditional assets like art and other collectibles. The knee-jerk reaction is to fade this idea — because manias come and they go and they always go a lot faster from whence they came. But what is thew catalyst in the near term? We have a government on the cup of doling out another $1.9t and the ball is quickly rolling downhill.
At the end of it all is the notion of confidence. There is hubris embedded in this tape — extreme confidence. You cannot will it away. In order to break this spell, you’d need some significant damage to important momentum sectors.
My advice: keep going until it stops working.
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Another working theory, based on you pointing out low rates, is that, from an asset allocation standpoint, bonds are comparatively risky for pensions and boomers. Reversion to the mean suggests interests rates are much likely to rise vs. a total market collapse. Money has to go somewhere, and with inflation creeping up plus risk of rising rates, bonds do not seem attractive.
Biden willing to cap the handout to those making under $250,000 per year. This is first class insanity again. Where is the improvement, there is no improvement.
I can spend it just as fast as the 75k dolla guy.