Savers, you can forget about opting out of the stock market. If you want any kind of return you will get in the market and you will like it. So what if artificially repressed rates are crushing you? So what? Do you think you matter? Most of you savers will be dead soon anyway. You and your bank CDs. How quaint. Now pony up and buy some more stock grandma. Oh I’m sorry? You think there’s too much risk in the market? Who are you to say?The banks and government want 0% rates and they are going to get them. Why not for the next 50 years? That’ll induce “investment.” What could possibly happen? And if anything does go wrong (not that it would) we’ll just cut rates again and again and again. We can do this all century if we have too. There is no way that artificially low interest rates will create so much malinvesment that the system will implode on itself. No way. Nope. The central banks are bigger than the market mechanism grandma. You’ll see.
Actually you won’t. You’ll be dead which is even better for society.
Dow 100K or bust!
“If the government absolutely said interest rates are going to be zero for 50 years, the Dow would be at 100,000,” Buffett told “Squawk Box,” stressing he was speaking hypothetically. The Dow Jones industrial average closed at 17,773 on Friday.
In a CNBC interview last week, Buffett also spoke about interest rates. “If you had zero interest rates and you knew you were going to have them forever, stocks should sell at, you know, 100 times earnings or 200 times earnings,” he said.