A lot on here have turned very negative on stocks?
Why exactly is the US stock markets (and there for most all global markets) going to take a beating? From my simple outlook surely the property market (maybe not so much Australia) is at far more risk? sure this will have a negative impact on stocks but surely the property market would be the one to take a real hiding.
I read that about 20% of mortgages in the US are related to the sub prime mortgage market, surely not all of them are in trouble, overall household debt is high also but I would guess many of those with this debt donít own shares on a large scale unless through pension funds which they couldnít touch anyway, if they get caught en mass itís the family homes that will flood the market with few buyers to satisfy the creditors.
Also I cant see the great American consumer slamming the wallet shut even if they have lost his/her home, if they have got a job they will spend there money, its become part of there culture to spend rather than save maybe not as vigorously but spend just the same, probably a good reason why theses problems are occurring !.
Iím sure there may be some lenders in deep water and this will be negative for stocks, maybe the bull has run its course but a meltdown and bloodbath I very much doubt, also corporate debt doesnít seem to be overstretched and many big companyís are making healthy profits both here, the US and Europe, share buybacks are being conducted by more than a few.
As I said above this may be a very simplistic view but thatís how I operate with my trading/investing and life in general, seems to work, well for me anyway.
Maybe ive missed something?