What could save the stock market in July? More government borrowing and Federal Reserve money printing

MarketWatch/Nigam Agora

graphic image of a wheelbarrow full of green bags of money“However, such optimism does not justify the extent of the strong stock market rally from the lows. The real impetus behind the market’s strength is money printing by the Federal Reserve and borrowing by the government. Now politicians have set up the stock market for a decline this month. You can expect more stimulus and support to keep the stock market rising.”

USAGOLD note:  The danger is that dependence on government borrowing and Federal Reserve money printing becomes a permanent state of affairs.  Since we’ve never been in a situation wherein stock market value is radically dependent on government and central bank largesse, it is impossible to predict where it leads us and where it all ends. Some of the monetary stimulus and support Agora sees as on its way could leak into the gold and silver markets as well. In fact, those monetary reinforcements are what Bank of America sees as pushing gold to the $3000 level, as mentioned in last Friday’s Daily Market Report.

Repost from 7-6-2020

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