#19 The Value Investor
Behind the Balance Sheet
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The Stock Market Is Down 40% on the S&P and 60% on the NASDAQ
The stock market needs QE and they need zero interest rate policy. So now when you've got good news on the economic front, stock market behaves badly. If we get two years in of inflation running hot and money rates below inflation, once you start to refinance more and more of this debt at higher yields, again, you take a hammer to profit margins,. stocks will get hurt. And those of the over levered balance sheets will lose the businesses.
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