Examples

of von Mises credit expansion, and less disturbed markets.

Since a few month there is just one way for stock: up. Driven by?

Well as we learned some of the companies (in the IT section) are earning really big. Isn’t it amazing? They live under constant price pressure, and indeed falling prices since at least 20 years.
Now you can buy mobile phones with more computing power as super computers some 10-20 years ago. And here in Germany we have more mobile phones than inhabitants. This is a an example for
more free than strangled markets. Assume other area where less is regulated etc. So indeed they are earning their money. People want to have this phones.

There are other areas where much is earned (even measured in records) the German car industries. VW, BMW they nearly never have earned more. Fair enough it’s with ol’e fuel burning cars. The so wished for cars driven by electricity do not have any real market share. Again people seem to be willing to buy German cars wold-wide

But what about all the other raising prices. Well AFAIK they are driven by “free” money. And indeed this money was not earned but “generated” from central banks, and this money disturbes every thing. We simply do not know any more what parts of the raises are due to “demand” and which one are just due to the inflated money base. The prices are loosing more and more their indication value of sparseness. And that is the von Mises credit expansion. There are “success” stories of employment but is that really true. A lot of figures to seem to indicate this is not the case. And who publishes this statistics organization of the states. In Germany we just know one thing the low paid , half time working day is on the raise. I can’t tell if it’s due to the people wishing to work shorter times or simply not finding normal paid working days. I can’t tell, but at least it seems this is not what most are wanting. But the raising part-time working days do have effects on everything. Of course the people do earn less, and so they surely demand less. And this means the current fired demand by “cheap” money can end and in fact will end one day. We do not know when, we’re lacking the “base” information undisturbed do give us. Most of the prices are not set any more by offers/demands, but by prices set independently just by different taxes.

We know e.g that oil prices are near their highs from around 2008. We also know what has happened the last four years, will it be different this time? We can doubt it. As von Mises has told us, some day credit expansion has to stop. The earlier the better, but the central banks to have prevented that “healing” for now at least 2 – 3 years, and if we follow von Mises this means the crash of whole currencies is inevitable. So yes be happy that the stock prices are raising, but do not forget to sell in time….

As I wrote examples of earning and burning….

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