Look At The Markets Go!

Look At The Markets Go!

Have you noticed you haven't heard much about the stock markets collapsing lately?

This is because the Dow Jones Index in the US has been going to a historic new high just about every day over the past week. That's right. The US stock market is at all time new highs. Imagine that. When so many said there would be a recession and a collapse this year. Those people are always around. All I can say to you is forget the doomsayers.

Business Graph with arrow showing profits and gains on a white reflective background

You know those people who have been wrong for the past seven years. Meanwhile we continue to be rewarded for a far more positive view of the world. It is not that we are optimists. It is just that the world is a positive place. I fact we all live right now in the midst of the most prosperous period in history. Measured by wealth levels, poverty levels, innovation, well being, anyway you look at it these are great times. This is why stock markets are rising all around the world and so too are property markets.

In the US this week, continuing on a long stream of accelerating data, we saw Existing Home Sales continue to boom!

US existing home sales are a great indicator of Main Street enthusiasm, that is the state of the real economy where real people live and work, and they are going from strength to strength. The US economy is booming! Watch for very strong GDP acceleration through Q2, Q3, and Q4.

U.S. Home Sales - Property Markets

Meanwhile we had good economic acceleration in China as I had been forecasting all along. The Chinese economy grew 6.7% from a year ago. that was the same number as previously. Still very strong. The underlying ere-acceleration can be seen however in the quarterly change data which showed the economy accelerating from growing at 1.2%a quarter to 1.8% a quarter. Thats very impressive for what is the second largest economy in the world.

Just getting back to the US stock market continually making all time new highs?

Just think for a moment, what would be happening in the media if the stock market was making major new lows? It would be front page news, with in-depth reporting and minute by minute updating about how the next great depression was upon us, and it was the end of the world.

When its all good news, and spectacularly so by the way, where are the front page stories about billions being added to the value of the market and everyone getting rich. Where are the stories about we should all be excited and happy? Where are those stories? I think there’s only a few of us telling it as it is.

If you have been to one of my talks, you know I discuss how the media is about fear and not reality. This past week really emphasises that point.

Be very aware that all asset prices over the great majority of the world, including property right now, are headed higher. My year ago forecast for a 20% property price increase in Australia by 2020, continues to look to be on track.

Clifford Bennett

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