governments create inflation with gov spending and credit...

governments create inflation with gov spending and credit creation

stocks are valued on the basis of earnings going forward

business will maintain margins

even if there is no real value being created and it is all inflation profits will go up

profits drive prices

technical analysis will always reflect fundamentals

the degree to which depends on whether you think price equals value

if price equals value tech analysis is as good as fundamental analysis
price = value

when price and value get out of synche technical analysis becomes less valuable as a tool

price is more a refleciton of emotion and market forces

I personally think price and value walk in lock step

that means that I think technical analysis is as good fundamental analysis for the most part

the minute price is out of synche with value then fundamental analysis becomes important
thats my take on it



earnigs drive price

assets that are scarce will go up in value

b

it comes down to the efficient market hypothesis

you either think price and value are in a one to one relationship

or you think they are out of synche

if price reflects value that is it is in a one to one relation then technical analysis and fundamental analysis is as good as each other

if however price and value are out of synche then functional analysis would be more valuable than technical analysis.

price wouldn't equal value

value is measured on earning going forward

at this point price is not so important all that matters is real business value

that is all you have got. price is not based on real value but sentiment and other irrational thought

fundamental analysis will always reflect value
ie
earnings going forward

inflation will occur due to gov spending and credit creation

but business will always maintain margins

prices should reflect value

if inflation affects real value prices will follow