Investors are holding near-record levels of cash
“Investor cash holdings are near record highs, and that could be good news for stocks since there is a wall of money ready to come right back into the market. But the question is this: Will those investors return any time soon, especially with sentiment still so sour and stocks at risk of a major selloff?”
USAGOLD note: For the first time in years, investors are able to garner a decent return on money markets. That’s no small matter. Wall Street, no doubt, is chomping at the bit for that cash to wash like a great wave into the stock market, but that money could also sit where it is for a long time to come. Merryn Somerset Webb, a senior columnist at Bloomberg Opinion, thinks cash holdings might be another dead end for investors. “If you are holding cash,” she says, “it is only a temporary king.” She says that inflation, which erodes the value of cash, will be with us for the long haul and that investors should look to gold, as an alternative.
