As the U.S. stock market continues to yo-yo about like a row-boat on choppy waters and reports rippling from across the ocean suggest that the Euro-zone is just barely keeping its head above water, there have been some pockets of relative calm and even prosperity. So just who is benefiting from all the economic turmoil as of late? Here are five groups:
1. Company executives. Though the average investor may be getting a bit jittery when it comes to leaving money in the stock market and has fled to “safe havens” such as gold and treasury notes, it seems that company executives are taking advantage of the downturn to buy up their own company’s stock – often at fire sale prices. While some might say that these people are living in their own Wonderland and are out of touch with the stark realities of the economy, you still have to wonder why so many “insiders” would want to park their own money into a seemingly “doomed” investment.
2. Big Banks and speculators. The Fed’s recent announcement that it will be keeping interest rates artificially low for the next two years to bolster a stalled economic recovery, is a real doozy that will do little to help Main Street, but has Wall Streeters breaking out bottles of champagne in celebration. Why? Because these days it just pays more to speculate and try to game the market, rather then letting your money wallow in a money market account with practically no interest to speak about.
Moreover, with money so cheap, big banks can basically borrow money for free from the Fed, and then use it to buy low yielding treasuries at 2 to 4 percent among other investments. With a deal like that, while would a bank willing lend money to small businesses and private borrowers who present a much riskier investment opportunity?
3. Companies that provide security safes and vaults. As the markets continue their stomach churning ups and downs and the world economy stands on shaky legs, the sales of safes and vaults having been going through the roof. Many of these sales, include luxury and custom vaults. In addition to jewelry and cash, many upper-end safes and can hold bars of gold and other items and can even survive several hours in a fire.
4. Sellers and creators of fine art. With all the volatility out there, many wealthy individuals are looking for places to park their wealth. One of the most popular and in vogue investments has been in items of fine art, such as paintings, sculptures, and jewelry. These items are not being bought solely for their aesthetic beauty, but also for their resale value.
5. Sellers and producers of luxury goods. In keeping with the above trend, the sale of luxury items, such as clothing, cars, cosmetics, and furniture, has picked up steam over the past couple of months. Even with all the volatility of the stock market, the buying of expensive name brand items is once again becoming an accepted practice- so much so that many of these upper end goods are literally flying off the shelves.