{"id":37377,"date":"2013-04-07T23:03:39","date_gmt":"2013-04-08T03:03:39","guid":{"rendered":"http:\/\/countingpips.com\/forex-news\/?p=37377"},"modified":"2013-04-07T23:03:39","modified_gmt":"2013-04-08T03:03:39","slug":"a-better-inflation-bet-than-goldstock-market-investing","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex-news\/2013\/04\/07\/a-better-inflation-bet-than-goldstock-market-investing\/","title":{"rendered":"A Better Inflation Bet Than Gold\u2026Stock Market Investing"},"content":{"rendered":"

By MoneyMorning.com.au<\/u><\/a> <\/p>\n

On 20 June 2012 we told you it was a great time to buy stocks<\/a>.<\/p>\n

We put our neck on the line by suggesting you look at five beaten-down Aussie blue-chips<\/a>.<\/p>\n

Not everyone appreciated our advice. Some said we were mad telling investors to look at those stocks<\/strong> when the financial world was falling apart.<\/p>\n

Now, as those stocks have gained 43.7%, 63.9%, 78.2%, 50.4%, and 38.2% respectively, many folks have changed their mind. They now want to read more ideas on how to take advantage of this crazy market.<\/p>\n

So we\u2019ve knocked around a few possibilities with our publisher for the best way to get those ideas to you. We think you\u2019ll like it. Stay tuned for more details in the coming days. Until then…<\/p>\n

Here\u2019s a novelty: bad news on the US jobs front last Friday saw the US stock market fall. That\u2019s not how it has often worked in recent years.<\/p>\n

Much of the time the market has seen bad<\/em> news as good<\/em> news. Why? Because investors have figured out that the worse the news, the more likely the US Federal Reserve<\/a> will print money, which will be good news for stocks.<\/p>\n

But the good news\/bad news angle can only get you so far. Ask Japanese investors. They\u2019ve seen more than 20 years of money printing and the market is no higher today than it was in 1986:<\/p>\n

\"NIKKEI<\/div>\n

<\/p>\n

Source: Yahoo! Finance<\/div>\n

<\/strong><\/p>\n

That said, the market has surged to trade at a level last seen in 2008. That makes the current level a five-year high. And what was the catalyst for the rally? That\u2019s right, Bank of Japan money printing.<\/p>\n

A Surprising Fact About Japanese Stocks<\/h2>\n<\/p>\n

That\u2019s the thing. It\u2019s easy to point to Japan and say money printing doesn\u2019t work. Look at the chart; that\u2019s proof. <\/p>\n

However, look at the chart again, especially the past six months. That shows you, regardless of the effectiveness of the policy on the broader economy, the fact is that it can have a positive impact on stock prices.<\/p>\n

We\u2019ve seen similar comments about the effectiveness of money printing on the US economy<\/a>. The unemployment rate is still high, more people than ever are on food stamps, and US public sector debt is at record levels.<\/p>\n

It\u2019s all true. We can\u2019t deny it. But the one statistic they forget to quote is the most important one for an investor \u2014 the US Dow Jones Industrial Average has gained 120% since the low point in 2009.<\/p>\n

That\u2019s almost twice as good as the performance of gold during the same time. The gold price is up <\/a>67% since March 2009. And it\u2019s better than silver<\/a>, which has only gained 102% since then:<\/p>\n

\"US<\/div>\n

<\/p>\n

Source: Google Finance<\/div>\n

<\/strong><\/p>\n

Now, we\u2019re sure that you could cherry-pick some other dates and produce a different result…but it would be just that, cherry picking. And if one thing\u2019s for sure, cherry-picking results in hindsight won\u2019t make you a darn dollar as an investor.<\/p>\n

Instead, you need to focus on the future and make your best guess about where the stock market<\/strong> is heading next.<\/p>\n

Look at the chart of Japan\u2019s Nikkei 225 index again. Since 4 January 1990, there have been 5,718 trading days. How many of those days have been up days. 1,000? 1,500? Try this…<\/p>\n

Of 5,718 trading days, 2,842<\/u> days have seen the Nikkei 225 close at a higher price compared to the previous day.<\/p>\n

(Don\u2019t take our word for it. Go to Yahoo! Finance and download the daily data for the Nikkei 225, calculate the gain or loss for each day, sort them in ascending order and then count the plus days and minus days. You\u2019ll get the same answer that we did.)<\/p>\n

In other words, 49.7% of all trading days on the Japanese market since 1990 (23 years) have resulted in stocks going up.<\/strong> That\u2019s despite the overall market falling 66.9% during that time.<\/p>\n

Do you see what we\u2019re getting at?<\/p>\n

Still the Best Bet for Long Term Wealth Creation<\/h2>\n<\/p>\n

We\u2019re not saying you should ignore high unemployment, record high food stamp usage, or multi-trillion-dollar debt levels. But we are saying that you shouldn\u2019t allow it to interfere with your ultimate goal…<\/p>\n

And that is to make mone<\/a>y from what still remains the best short- and long-term way to build wealth \u2014 the stock market<\/a>. You can read about some of those ideas here<\/a>.<\/p>\n

Stock market investing<\/strong> has always been an active investors game, and it still is. If you stay active, watch the market and place your bets at the right time, the stock market can reward you handsomely<\/a>.<\/p>\n

Don\u2019t let the \u2018down crowd\u2019 scare you away from the potential riches of the stock market.<\/p>\n

Cheers,
\nKris<\/a><\/strong>
\nJoin me on Google+<\/u><\/strong><\/a><\/p>\n

From the Port Phillip Publishing Library<\/strong><\/em><\/p>\n

Special Report: TORRENT SIGNAL 3<\/a><\/p>\n

Daily Reckoning<\/em>: Can the Stock Market Crash Anymore<\/a>?<\/p>\n

Money Morning<\/em>: Opportunities in the Australian Energy Landscape<\/a><\/p>\n

Pursuit of Happiness<\/em>: Why a PlayStation and Mining Technology Have More In Common Than You Think<\/a><\/p>\n

Australian Small-Cap Investigator<\/em>:
\nHow to Make Money From Small-Cap Stocks<\/a><\/p>\n

\n<\/img><\/a> <\/img><\/a> <\/img><\/a>\n<\/div>\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

By MoneyMorning.com.au On 20 June 2012 we told you it was a great time to buy stocks. We put our neck on the line by suggesting you look at five beaten-down Aussie blue-chips. Not everyone appreciated our advice. Some said we were mad telling investors to look at those stocks when the financial world was … <\/p>\n

Continue reading “A Better Inflation Bet Than Gold\u2026Stock Market Investing”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-37377","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts\/37377","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/comments?post=37377"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts\/37377\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/media?parent=37377"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/categories?post=37377"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/tags?post=37377"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}