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Market Investors – What are they thinking?

Investors continue to listen to MSNBC and other financial outlets, which alternately cheer, at best a lackluster global economy, then lament, at worst a European economy that is on the brink of bankruptcy.

Again this weekend, the Associated Press reported that Greece is losing billions in uncollected taxes, yet doesn’t have enough money to guarantee the European Union that it will pay its debts.

The European Union’s report said that about half of the $81B in uncollected taxes are tied up in lengthy court procedures that can take up to seven to 12 years to resolve – that’s socialism for you!

The European Union’s economic growth was only 0.2% and that didn’t include Greece and Italy. That’s kind of like not including New York and California, Illinois and Michigan in the United States – could we?

The U.S. sells about 20% of their products to this group, which taken together is the largest economy in the world. That will effect our market’s bottom line – but investors continue to buy, buy and buy as interest rates continue to set records.

As interest rates rise, European countries must pay more of their revenue for interest and they go deeper in debt, slowing the economy even more – a Catch 22.

The 17 nations that make up the group have a 10.2% unemployment, even higher than the U.S. with an unemployment rate at 9%. The U.S. contributes about 16% of the International Monetary Fund, which has loaned billions to these countries, placing some of our banks at risk.

Yet investors keep on taking the plunge! What are they thinking?

Investors are on a roller coaster ride due to the up again, down again reporting of the media and the action of the markets. It is enough to make normal investors sick, but the investor-gamblers are still there everyday to “grease” the skids.

Someone must be making money on all this turmoil, but they are probably spending most of their profits on acid reflux medications.

 

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