/biz/ - Business & Finance

Before anyone heard of coronavirus, the entire planet was at record levels of debt. Just in the US, corporate, consumer, municipal, state debts are record levels. The virus was just the trigger, but the problem will be loss of revenue leading to defaults. And when companies default, bond-holders default, and banks fail, and so on. QE injects more money into the system to prolong the house of cards. The virus is just a trigger.

So the Fed prints money for weeks to lend money and then they lend money and then they lend money and now I'm lent money all the way until virus is over...Now what does the world look like?

Basically just hits the pause button until people can go back to work. House of cards is an incredibly apt description of the economy in the last decade, let alone the stock market which doesn’t reflect reality whatsoever...

Stocks are literally a gamble that the company you’re investing in will grow its profits in the future, giving you a return on investment. The stock market has grown out of proportion to what the real economy can actually deliver in terms of growth. No one knows the future, but the chances the real economy meets the expectations of the market are statistically improbable.

When that giant casino of inflated values collapses, either through a banking and housing crisis in 2008, or via the economy gridding to a halt because of a virus, you see all that stock value wiped out because the true value of the economy is laid bare and no one is buying the sales pitch of infinite growth anymore.

Maybe someday when robots can produce infinite amounts of economic output without human intervention we could see true economic growth that matches the insanity of our stock market, but humans and the machines we have now can only cumulatively produce around a 3-5% annual rate of real growth, a far cry from the massive numbers in the stock market.

>tfw my frugal lifestyle will enabled me to go full cocoon mode during these hard times
>tfw mum can't even say anything when i get laid off, i can just blame my comfy NEET lifestyle on the harsh economic climate
feels good man

Exactly how much fucking money are they printing right now