Not Enough Supply of Risk Assets

JC Parets
December 29, 2021

It's important to zoom out and really put what's going on into perspective.

You hear a lot about how much money is being created with fed money printing and the Powell and senator Karen yelling into the air for no reason.

It's all been well documented.

We're seeing unprecedented numbers being raised by companies issuing equity and debt, as highlighted here by the FT:

But think about this.

Between all of this issuance and record number of IPO raises this year, you would think that there would be more than enough supply of investments to go around.

But it's actually the opposite.

Despite the availability of all of these investments, there is still more demand for risk assets than there is supply of them to feed that demand.

The stock market indexes at all-time highs are proving that.

Yes there are plenty of stocks, junk bonds, Cryptos and other "risk assets" for people to invest in.

Yet, there still isn't enough. There continues to be more demand for these things than there is supply.

It's not my opinion, it's just math.

You might not like it. You may not agree that it should be happening.

But your opinion doesn't matter in this equation.

These are just the facts.

You can choose to take advantage of the circumstances, or you can choose not to.

That's up to you.

Which one do you choose?

Let us know! We love to hear from you.

JC

 

Filed Under:
ASC