Monthly Archives: November 2014

“the end is nigh” for stock market valuations. Or is it?

We’re All Doomed – are we not?

The papers seem to be full of pundits predicting that “the end is nigh” for stock market valuations at their current level. And if, or when this happens, no doubt there will be a few people proclaiming that they saw it all coming. But the so called melt down that pundits are talking about if it did happen, and it is still an ‘if’ whilst this would hurt, you have to remember that history tells us that this is probably a rare event, in fact a very rare event. The question I would ask anybody is does it actually matter? If you are investing money into the financial markets it should be medium to long term funds anyway. Of course we would all love to be able to ‘get into the markets’ just after a crash, and maybe get out just before one. In reality this isn’t going to happen. That’s because nobody really knows, honestly, even the Mail and the Express.

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Financial Markets

And they say a week in politics is a long time. Just look at the financial markets since I wrote my last blog on the 15th October. I said then that markets fear the worse and then recover. And this would appear to what has now happened. On Friday Stock markets across Europe surged and the Footsie posted its biggest advance since February after the Bank of Japan announced a surprise stimulus programme. This set off a wave of optimism that saw the dollar strengthen even after the US Federal Reserve ended six years of its own fiscal stimulus.

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