“Take a look at the graph accompanying this article. It compares the total assets invested in money market funds (essentially a proxy for cash) to the market capitalization of the broad-based S&P 500 stock market index.”
“You’ll note that every time we’ve seen a similar mountain of cash holdings, there has been a market bottom. And it’s easy to understand why. This record level of cash is currently generating perhaps a 1- to 3-per-cent return before taxes and inflation. No investor I have ever met is satisfied with this kind of meagre return. The money has to move off the mountain soon.”
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