I totally agree Lynas revenue and profits will increase. I have never said otherwise, Lynas is a great company in a great market. The problem is market Cap, Revenu per share and earnings per share. I do not see revenue or profits increasing to a point to support a market cap of AUD 8B! Current book value is just over a billion for most stocks Market cap is one or two times book. There is only 3 ways to increase book Value
Earnings Sell assets for more than they are the balance sheet for. or Sell stock. Further diluting shareholders. I have asked many times how Lynas can grow enough to bring these into normal ratios by say 2026 no one has answered.
As far as regulators preventing a large correction they cannot do it! If you think so tell me how. The markets are up for one reason and when that goes away there is nothing the regulators can do to stop a slide especially if they are dealing with high inflation.
The CBOE PUT / Call Ratio is below .5 and has diped as low as 0.28. When people are optimistic about stocks they buy calls pessimistic buy puts for protection. Normal is about 1.0 So options are flagging over optimism. In US the stocks bought on Margine is nearing the level of Dot Com. If market starts to fall many will be forced to sell
even if they do not want to.PEs are at all time high another sign of over optimism. The regulators cannot stop the market from goin up. Once reality sets in they cannot stop it from going down. They are their to stop risky and corrupt behavior not tell normal people what to do
End of NOV. there was USD 918B of margin credit in US. All but 211B was used to buy stocks
for comparison in Nov 2019 592B was in customers accounts and they had used all but 178B to buy stock.
So in '19 592B - 178 = $ 414B of borrowed funds was in the market.
2021 918 -211= $707B how much of that will result in margin calls if market starts to fall.
https://www.finra.org/investors/learn-to-invest/advanced-investing/margin-statisticsHere is a S&P 500 90 year history of the average PE. The gray bars represent recessions. DO you see any relations at all?
https://www.macrotrends.net/2577/sp-500-pe-ratio-price-to-earnings-chart
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