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<p>[QUOTE=&quot;medoraman, post: 1728471, member: 26302&quot;]Again, I do not understand how you say the Fed is &quot;inflating stocks&quot;. In what way? I agree there is tons of easy money around, but to me stocks are up due to dividend returns being higher than interest returns. With the market being up this reason is being rectified. Is this the way in which you mean the Fed is &quot;inflating stocks&quot;? The same could be said of PM prices, in that people were only buying them for higher anticipated returns than could be obtained from owning bonds.</p><p><br /></p><p>Regarding your worry about derivatives, you DO know the sum value of all derivatives is zero right? So, if you are not investing in firms with high derivative participation, what risk is there? The only &quot;risk&quot; I see is for firms having large derivative positions, positions that either have counterparty risk that the asset may not materialize, or derivative positions that they do not understand and could hit them harder than anticipated. BUT, on the whole, the entire system is not at risk due to derivatives, since IN TOTAL all derivatives equal zero. The huge numbers you throw out is done frequently to scare uneducated market participants in my experience, (usually done by salesmen so you will buy their crud like bomb shelters, canned food and bars of silver).[/QUOTE]</p><p><br /></p>

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