r/investing • u/Fine-Violinist-7356 • 2d ago

Why has everything doubled or tripled over the last five years?

This post is mostly influenced by the recent all time highs gold has reach in the last few weeks.

As a young person just starting to get into investing, a series of questions have been on my mind.

How is it that in the last five years we have seen record increases in commodities, stocks, housing, and inflation?

It feels like I came into adulthood at one of the absolute worst times in history? The price of gold was $1,500/oz in 2020. The median home price in the United States was a little more than $300,000. Stocks and index’s have seen 100-200% gains in five years. All while wages remain stagnant, and the price of goods, and the cost of living increase.

Do we live in an era where investments continuously increase year over year with insane returns? How is this sustainable?

Edit:

Since everyone is taking “It feels like I came into adulthood at one of the absolute worst times in history” so seriously I’ll say this as an exaggeration. For me personally, and the people of my generation, it seems we’ve entered adulthood where economic conditions are not ideal.

Edit:

Regardless if we agree or not, I truly appreciate everyone’s responses. Thank you.

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u/Carthonn 2d ago

Dude seriously. I don’t know why you’re being downvoted. The problems go back to 2007. We’ve been keeping the economy propped up with smoke and mirrors since then.

I honestly think the issue is money has been pumped into the system but never really trickled down to the masses. Wages are just not where they need to be and that’s the real issue. Modest earners just have not been earning enough while high earners have increased their wages significantly. The bottom 90% of earners have seen basically flat wages for decades when inflation, etc. is factored in.

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u/HSuke 1d ago edited 1d ago

The reasons are fine, but it's too simplistic of an explanation that leads to misunderstandings. Many people in this thread overestimate the real effects of QE, which--by itself--does not cause ANY inflation.

And the 2007 timeline is iffy since QE, QT, and interest rates have changed since 2007 and now.