In Are stocks good value?, we mentioned that,
You can make the Dow climb as high as you want as long as you print enough money (that is, provide enough liquidity). In fact, if you run the printing press hot enough, anything that you ?invest? in will increase in price… with Zimbabwe?s inflation rate in the order of thousands of per cent (in May 2006), almost anything you buy in Zimbabwe will increase in price by 100-fold after a year has gone by. But are you better off by a 100-fold if you do that? Of course not! In Zimbabwe?s case, all it meant was that the money had become worthless!
Take a read of this article from the Mises Institute regarding Zimbabwe’s ?roaring? and ?booming? stock market.
