THE LONGEST EQUITY RALLY OF ALL TIMES
Once again
the DAX is sadly only driven by the US markets and again its overall
performance compared to the US markets is more than lousy!! No volume – no
performance – this is the outcome of the German leading stock index. Indeed a
shame.
Ever since
2000 the DAX price index is down from 6266 points to 5719, while the Dow Jones
came from 11600 and is now trading on 25814 points. Indeed hard to believe the
only reason why the well known performance DAX (including reinvested dividends
ever since June 1988, its start) are dividends. And knowing that German stocks
are quite cheap compared to US ones, doesn´t make them more attractive to
German investors. Again they stay off the lines and prefer to lose their money
while leaving it in money market funds or just in cash. And just to mention the
overall amount invested in cash and money market papers in Germany rose in
spring this year up to 2,4 trillion Euro. And his amount is already used by the
German government as collateral to guarantee the survival of Italian Banks. And
some of them are really in terrible shape. So ultimately German investors will
lose it all in the case Italian Banks will fail and there are some that could
really go bust. So German investors fear the risk and stay off equity markets
but will finally lose it all because of no or the wrong investment. And if they
don´t lose it there, they will lose it due to the inflation. Just to mention
prices ever since 2002, the start of the Euro as a payment tool, increased only
in Germany by more than 110%, so the loss in buying power is more than 55% and
this means the yearly inflation ever since then was 5% and not what is officially
mentioned, below 1%. Wow, what an outlook.
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