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January 4, 2020 | Less ‘Food’, Less ‘Clothing’, Less ‘Shelter’: But UP MARKETS!

Donald B. Swenson: Born January 24, 1943, Roseau, Minnesota. Graduated H.S. 1961, Moorhead High, Minnesota. Graduated College 1968, Moorhead State University, Minnesota. Designated member of Appraisal Institute (MAI), 1974. Employed with Western Life Insurance Company, 1968 – 71; Iowa Securities Company, 1971 – 73; American Appraisal Company, 1974 – 81. Part-time teacher/valuation consultant/bartender, 1979 – 2008 (taught workshops at Waukesha County Technical Institute, Wi. and Madison Area Technical College, Wi.). Retired 2008 (part time teacher/blogger), AZ. Self educated economist/philosopher/theologian:

Today, one of my investor friends asked me if the markets could continue UPWARD in 2020? My response was that I have no idea as these markets are not tied to material production. I said that the Dow Index was up some 24% in 2019, the S & P 500 was up some 29%, and the Nasdaq was up some 35%. My friend said could the Dow be at 39,000 by the end of 2020? I said, sure. It’s possible (but unlikely).

I mentioned that my reference point for these digital markets is the Caracas General over in Venezuela. This digital market in Venezuela was up some 5639% this past year and it continues UP even as the economy struggles with the basics of Food, Clothing, Shelter, and Transportation. The real economy is our production, I said. But the markets today are mere digits within a computer screen. Can you discern this situation, I said?

Could a digital market (like our Dow) continue to increase even as our general economy (production) declines? This is certainly possible, I said, now that algorithms rule over trading and virtual digits represent our money. Our dollar is now a virtual/digital ($1) and it has NO ‘tie’ to material production. We have no tie to gold or some physical item which represents production or value, I said.

I asked him to download a financial App like the CNBC app to follow the digital markets. Today, our central planners could certainly continue the UPWARD momentum within all these digital markets IF THEY CHOOSE. Algorithms and digits can continue to go UP and UP even as the general economy heads for a Depression. With no ‘tie’ of our money to a ‘thing’ of value, the SKY is the limit.

It’s all Math and Numbers, I said. Think on this situation and then follow the markets and ask yourself if our Central Planners will continue this charade in 2020. Venezuela seems to continue the charade and maybe Mr. Central Planner will do likewise. Have a good day and watch out for this emotion called inner Confidence. Our markets are a Confidence Game and all this could change in a moments notice.

Dow: up 330.36, NASDAQ up 119.59, S & P 500 up 27.97 (Welcome to 2020)

I am:

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January 4th, 2020

Posted In: Kingdom Economics

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