American stockmarkets have enjoyed a record-breaking streak, even though the country’s economy faces the deepest recession in living memory. Why is stockmarket performance so seemingly cut off from current events, and what does this tell us about how the economy works? Read more here:
Further reading:
Find The Economist’s most recent coverage of covid-19 here:
Sign up to The Economist’s daily newsletter to keep up to date with our latest covid-19 coverage:
Read our leader on America’s economy and its banks:
What Wall Street’s results tell you about America’s economy:
Americans need more guidance from the Fed:
Read about the economies that have started to bounce back:
Why stimulus policies must shift as economies start to recover:
Listen to our “Checks and Balance” podcast: will covid-19 change the politics of poverty in America?
Read about China’s stockmarket:
Read our article on the resilience of banks:
The economy is being propped up by the largest government spending bills we’ve ever seen. That’s why things haven’t fallen apart yet
Kicking the can down the road again?
What China has to do with it?
Broken pottery pieces can be bound together with a rubber band for only so long…
@HOWARD BOYD lol.
@HOWARD BOYD
Agreed, not fair…but all of this has been happening since the Wilson administration. Only now are we able to see a small peek into the abyss.
Thank You! – like it is always so –
with the Economist’ brief reviews:
valuable and sharp – 🌟✌🏻
Thank You for sharing Your knowledge 💗
I always look at the YouTube comments section for unbiased, rational, and well thought out financial advice… rather than the actual channels I subscribe to. 😉
Same here😂😅 I learn so much on the comments section
As you should
Actual videos are the eye opener, while comments section open up a whole universe of truth.
Thought I was the only one 👌🏾
Lol, comment sections are just as biased as the videos, and have much less thought out financial advice. YouTube recommends only videos that they think you would watch. Therefore, people who comment on left wing media sources, are mostly left wing, and people who comment on right wing media sources, are mostly right wing. This means the comment sections are much more biased than you think.
“The FED could not not have stepped in.” I see, would like to hear a bit more focus on this particular point. The justification of pumping in debt as a life support for corporations as opposed to giving out money for people to spend (fiscal stimulus) is doubtful to say at least. Corporations live from demand, not handouts.
And whether we like it or not, the whole American economy is consumer based. If the masses aren’t consuming, the whole thing falls over. So, we all go back to work. A lot of the elderly & weak will die. Sacrificed on the alter of Wall Street. That Bull statue is a Religious Institution to Politicians. Oh well, I’m young & healthy. And if work doesn’t pick up soon I lose the house. At that point Antifa’s gonna be the least of the country’s problems….
You wont hear that discussed further from this source. It would undermine some of their followers beliefs
Maybe they meant that the FED has a mandate to maintain stable prices and maximum employment? Not intervening in financial markets would be tantamount to ignoring that commitment.
The Fed has put billions every month into the Stock Casino and is now BUYING Corporate debt.
so basically the corporate losses are socialized while profits are privatized, surprising
Wow, what a quote. I hope money officials see it this way (if they care about society in general)
@JAM You’re gonna fall hard buddy.
@JAM “well if you only would have done x then you would validate my belief system. My belief system is still intact.” Pretty much what everyone else hears when you utter the phrase “well you should have.”
@JAM ”
Why wouldn’t people already be invested in the market ?
Everybody is supposed to be saving 20-30% of their income and investing it for financial security, retirement etc.” You’re a donkey! In what world do you think people who earn less than 50,000 a year can put aside 20-30%? Let me guess “they are supposed to.”, “they should have”. What follows from there are just your ideas that have no material basis in reality. Go away boomer.
welcome to crony “capitalism”
4 simple words: Too big to fail. Investors know if things really go south because of the multiple crises we are facing, the government will bail them out on the our backs and the backs of our children and grandchildren. We and our government taught them this in 2008.
Economy and stock market don’t have to move identically in a short term. It had always been like that. It’s not just 2020
Nicely done! Thank you for the very informative analysis! Keep up the great work!
The zero interest rate and excess of liquidity made investors to turn to stock exchange. The major impact though was rebounding of market from excessive downturn when economy started to open after lockdown and fear of corona was managed
Two factors we never hear about: (1) given extremely low interest rates for ordinary savings, the only way to secure even modest returns is to invest in stock; (2) analysis confined to the USA in a globalized world is nonsense; the biggest factor sustaining stock markets around the world is the enormous increase in middle-class populations with money to invest in China, India, etc.
You’re spot on, as usually.
You educate us.
Excellent viewpoints!
Thank you!
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The government has decided to max out it’s “credit card” and the stock market is “surprisingly” doing well.
I’d be doing well too if I decide to max out my credit card. The problems will come when the bill is due.
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Very interesting video. My takeaway is this: on a free market, on which you have privately-owned businesses and private capital investors, the monetary policy can’t efficiently bail the economy out of a crisis. Sure, the Fed helped, but the quantitative easing won’t mitigate the crisis’ consequences in the long term.
“The stock market is a device for transferring money from the impatient to the patient” – Warren Buffett. I think most of your viewers know this quote, but it doesnt hurt to read it every once in a while
@Larry Agosto Sanabria – That is exactly why personal finance & stock market investing should be required as part of the curriculum in high school. I’m comfortably investing right now without fear b/c I know the market will go up, but people who don’t have a long term view of the stock market may not be doing that.
And the most patient of all are the stockholders of the Fed 🙂
Larry Agosto Sanabria
no.
Rev Victor Mejía Soria Nonsense!
there great truth to that i believe… when it comes to trading..
The stock market claims to be a valuable tool in price setting and speculative marketing, but it’s really just a place where wealth is transferred.
Agreed “from the impatient to the patient” as Warren Buffet said.
A huge ponzi scheme.
The stock market has always been cut off from how people react to the actual economy of needing basic resources such as food, oil, and paying bills. As well as a basic income.
I think this is just a sign of every day people wanting to get on with life.
Thanks for sharing. There are people like you talking about the right questions and learning which will eventually take us through Amazing content👍🏼
kudos to the economist for actually mentioning the fed when talking about the stock market. its more than i’ve come to expect from the mainstream media.
Very informative. i have always advise anyone going into the financial market to seek professional guidance. working alone might make you lose alot of money
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