Stock gains don’t make up for continued sluggishness in economy, job market
The Dow Jones Industrial Average today briefly touched the 14000 mark, before falling slightly. As I write, it’s hovering right around that level, the first time it’s done so since late 2007. The broader S&P 500 is at a five-year high, about 3 percent off its all-time peak in October 2007. The Nasdaq is at a 10-year high, though it’s significantly lower than its tech-bubble peak. In all, though, these major indices finally are back to roughly where they were before the housing crash and Great Recession (as long as we don’t adjust them for inflation, that is).
Yet, earlier today, the Bureau of Labor Statistics announced the unemployment rate had ticked upward to 7.9 percent even though more people had stopped looking for work than found a job. At January’s rate of job growth (157,000 net jobs created), it would take until at least 2025 to regain pre-recession employment levels. At the rate for all of 2012 (an upwardly revised 181,000), it would take “only” until 2022, a decade and a half after employment peaked.
And yesterday, the Commerce Department said the economy shrank in the fourth quarter of 2012, the first negative quarter since mid-2009. The economy is an estimated 14 percent smaller than it would have been if it had grown since 2008 at the long-term average of 3.1 percent a year. That’s some $2.25 trillion of economic production that never came into existence.
The reason for continued market advances in the face of sluggish economic news might be summarized by this quote from the Wall Street Journal:
“Any not-bad news is helping this market,” said Jonathan Corpina, senior managing partner at Meridian Equity Partners, a New York brokerage. “If we get great news, good news, or okay news, it’s still going to make our screens green.”
“Not-bad” is not exactly indicative of a boom. If this quarter were to repeat last quarter’s performance, the above numbers are where the Obama Recovery would have left us: barely back to zero for investors, still well below it for job-seekers and economic growth.
This is the reality wrought by the primary economic policy of the past four years — trying to jump-start the private sector via government spending and monetary expansion. All the spending and expansion hasn’t translated into robust private-sector growth. Four years later, there’s little reason to believe a boom is just around the corner.
– By Kyle Wingfield
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557 comments Add your comment
Michael H. Smith
February 1st, 2013
5:32 pm
Please don’t tell Warren Buffet the stock market is just too risky, it’s a real money loser.
Rafe Hollister preparing for an Obamanist America
February 1st, 2013
5:37 pm
Stock market is booming because the economy is so poor, and interests rate is so low, where else can you invest your money and expect a decent return that will keep pace with inflation. Yes, we do have inflation, in spite of the cooked government cost of living index. Money flooding into the market, creates a bubble that pushes up prices.
Tiberius - pulling the tail of the left AND right
February 1st, 2013
5:37 pm
If they were only limited to double standards, Michael. . . .
They’re all over the map as long as it fits their warped narratives.
Politico
February 1st, 2013
5:38 pm
LLB
Spin little one, spin
Politico
February 1st, 2013
5:39 pm
llb
Until this post I didn’t mention Obama, if you are able, less projection and more staying on point, but keep swinging with that wiffle ball bat………..
guy
February 1st, 2013
5:39 pm
Hang on to your hats. With obamacare,increasing deficits,too many takers compared to makers,and unemployment gaining, the _ _ _ _ will hit the fan before you know it.
Rafe Hollister preparing for an Obamanist America
February 1st, 2013
5:41 pm
I guess Obama regime has declared a war on women, they have moved to exempt religious organizations from having to provide birth control free through their insurance. We all learned, during the election, that forcing women to pay for their own birth control, is a declaration of war on the fairer sex.
Tiberius - pulling the tail of the left AND right
February 1st, 2013
5:44 pm
Lets not forget the increased uninsured now that obamacare is kicking in.
How sad that the only thing he’s been successful at in life is getting elected.
Doing his job? Not hardly.
Michael H. Smith
February 1st, 2013
6:01 pm
They’re all over the map as long as it fits their warped narratives.
Touché
JDW
February 1st, 2013
6:04 pm
@Rafe…”2 credit card financed wars caused our problems, yet the cost of those two wars was about 1 T”
No just about 1/5 of it…some of the other boneheaded things Duhbya did were give away a greater amount in tax cuts, start an unfunded Medicare drug program and run the economy in a ditch.
As for Grampa’s shotgun…it doesn’t hold thirty rounds that can be replenished in under two seconds with another thirty.
indigo
February 1st, 2013
6:05 pm
August 1941 – Army Chief of Staff George Marshall is trying to get Republicans to go along with a bill authorizing an extension of the draft. A Republican responds “I will be damned if I am going along with Mr. Roosevelt”. Marshall, a man of great integrity responds “You are going to let plain hatred of the personality dictate to you to do something that you realize is very harmful to the interest of the country”.
It would be nice to think, 70+ years later, that Republicans have long since moved past that kind of narrow, bigoted thinkin.
Unfortunately, they are even worse now and remain “the Party of hate”.
MarkV
February 1st, 2013
6:14 pm
I remember vividly Mr. Herman Cain on radio, before 2008, hammering into heads of his listeners that the stock market WAS an indicator of economic health. He never mentioned that again when he became a presidential candidate. It is just one of many issues that are flexible depending on where people are politically, who is in power and what is happening. I have no doubt that if the stock market collapsed we would hear exactly the opposite of what we hear now.
Lil' Barry Bailout - OBAMAPHONE!!!
February 1st, 2013
6:15 pm
JDW, it sure is a good thing Obozo did away with that awful Medicare Part D, eh?
Tiberius - pulling the tail of the left AND right
February 1st, 2013
6:16 pm
Indigo, you may think you know the motivations of those who oppose the policies without hating the man himself, but as usual your blindness and narrow thinking would prove you wrong.
Of course, if you could point to a policy of his that worked even remotely as he advertised, you might be able to bolster your argument.
md
February 1st, 2013
6:16 pm
Merely another artificial bubble subject to collapse if things go sideways:
http://www.usnews.com/news/blogs/rick-newman/2012/09/12/why-wall-street-loves-quantitative-easing
Generally, when bonds go down stocks go up…..and that in a nut shell is QE-Ind
Michael H. Smith
February 1st, 2013
6:18 pm
Opposing Roosevelt and war was hate and bigotry?
How delusional.
Now when the democrats opposed Bush and war it isn’t hate and bigotry?
How sanctimonious!
Michael H. Smith
February 1st, 2013
6:23 pm
Reading some of these post you begin to realize how few people understand the stock market or the true strength of the American economy per se’.
getalife
February 1st, 2013
6:23 pm
We need better job reports but the rest of the numbers are looking good.
Lil' Barry Bailout - OBAMAPHONE!!!
February 1st, 2013
6:24 pm
“Among the major worker groups, the unemployment rates for adult men (7.3 percent), adult women (7.3 percent), teenagers (23.4 percent), whites (7.0 percent), blacks (13.8 percent), and Hispanics (9.7 percent) showed little or no change in January. The jobless rate for Asians was 6.5 percent (not seasonally adjusted), little changed from a year earlier.”
———
Obozo may be a failure, but he’s your failure, eh, receptacles?
indigo
February 1st, 2013
6:28 pm
Michael H. Smith – 6:18
The Republican in question agreed with Marshall’s assessment but would not vot “yes” on it simply because he hated FDR.
indigo
February 1st, 2013
6:30 pm
Tiberius – 6:16
Get real. You and I both know what you really want is a whiter White House. Deny it all you want. The venom and hatred for Obama just spews out of you.
Michael H. Smith
February 1st, 2013
6:31 pm
indigo – 6:28
The democrats aren’t any different.
Michael H. Smith
February 1st, 2013
6:35 pm
indigo – 6:30
Non-sense, I want a righter White House, which you and yours will hate.
Tiberius - pulling the tail of the left AND right
February 1st, 2013
6:37 pm
Lets see.
Believe what Herman Cain thinks about the stock market, it what MarkV thinks he remembers.
I’ll take Herman any day and twice on Sundays.
Lil' Barry Bailout - OBAMAPHONE!!!
February 1st, 2013
6:41 pm
Are blacks who criticize Their President Bush racists too?
Or is this just another of your double standards, idigo?
Tiberius - pulling the tail of the left AND right
February 1st, 2013
6:44 pm
In addition to the many things you are wrong about on this blog, Indigo, we can now add your assessment of my thinking on race.
I don’t give a rats patootie who is in the White House.
Just leave me and my family alone.
You aren’t ready to debate someone like me.
Lil' Barry Bailout - OBAMAPHONE!!!
February 1st, 2013
6:44 pm
The thing I like about Herman Cain, in contrast to Obozo, is that he loves America.
Bruno
February 1st, 2013
6:47 pm
Did anyone here work as hard as I did today?? My partner and I saw 104 patients in one day……Sure is nice to be associated with a successful business.
Bruno
February 1st, 2013
6:49 pm
You and I both know what you really want is a whiter White House.
indigo–Why don’t you take your race-baiting elsewhere, loser??
Bruno
February 1st, 2013
6:49 pm
Kicking off the jams:
http://www.youtube.com/watch?v=HV3zWSawJiw
Tiberius - pulling the tail of the left AND right
February 1st, 2013
6:50 pm
I have no doubt President Incompetent loves America, lbb.
Nowhere else could someone so utterly unqualified be able to rise to such a position of power.
yuzeyurbrane
February 1st, 2013
6:53 pm
Compared to what Jay? Britain? They followed your austerity formula and are now in midst of triple dip recession. Others that austerity delusionals have bragged about like Ireland have much more pathetic economic numbers. You also base your claims on false assumption that Obama got everything he asked for. You know this to be false. The Teapartycan delusionals in the House combined with McConnell’s new 60 vote rule Republicans in Senate really stifled what should have been done. Yet we are doing better than other countries. Could you possibly get in touch with reality and see how much worse it would have been if no Obama policies had been put into place? Other than that I agree that the stock market is often an inaccurate indicator of the health of the economy at any particular time because it is a leading indicator of economic activity. Why didn’t you give the same view about the stock market when it boomed under W? Be consistent lest readers suspect that your opinions are influenced more by ideology than facts.
Hillbilly D
February 1st, 2013
6:54 pm
For Bruno
http://www.youtube.com/watch?v=zCh7z5EwYF8
Bruno
February 1st, 2013
6:54 pm
Just by chance you crossed the diamond with the pearl
You turned it on the world
That’s when you turned the world around
http://www.youtube.com/watch?v=uGr6knsm8t0
Bruno
February 1st, 2013
6:55 pm
LOL @ HD–That’s pretty much half of my day.
MarkV
February 1st, 2013
6:57 pm
“Believe what Herman Cain thinks about the stock market, it what MarkV thinks he remembers.”
If only people commenting here were at least literate.
md
February 1st, 2013
7:00 pm
“We need better job reports but the rest of the numbers are looking good.”
Negative growth is now considered to be a good number? I’ve heard it all now……
Bruno
February 1st, 2013
7:01 pm
Try this one with a few 100 mics in your system:
http://www.youtube.com/watch?v=3gV1sxB8TxI
indigo
February 1st, 2013
7:01 pm
Michael S. Smith – 6:35
Barry – 6:41
Tiberius – 6:44
Bruno – 6:49
In the words of Paul Simon
say now who do
who do you think you’re fooling?
Lil' Barry Bailout - OBAMAPHONE!!!
February 1st, 2013
7:02 pm
Tib: I have no doubt President Incompetent loves America, lbb.
—————
Not as envisioned by our Founding Fathers. Obozo longs for an America that makes people who love freedom, independence, self-reliance, and traditional values sick to their stomachs.
Tiberius - pulling the tail of the left AND right
February 1st, 2013
7:02 pm
Yuz, Britain DIDN’T enact austerity. They admitted earlier their efforts fell short.
And there was never any new McConnell 60 vote rule.
Lil' Barry Bailout - OBAMAPHONE!!!
February 1st, 2013
7:04 pm
who do you think you’re fooling?
———-
There’s no reason to fool anyone.
Why the paranoia, idigo?
Hillbilly D
February 1st, 2013
7:07 pm
Isn’t negative growth the same thing as shrinkage? It has been cold, after all.
Hillbilly D
February 1st, 2013
7:09 pm
Trivia question:
Who started the phrase “Founding Fathers”? (Hint) It’s not as old as you might think.
Aesop's Fables and other Lib Economic Theories
February 1st, 2013
7:09 pm
So, after hating on them for the better part of their meaningless adult lives, the socialists now leap in the air over the success of the 1 percenters down on Wall Street. Amazing, isn’t it? I am aghast and somehow heartened that a pinko has actually found an affinity for corporate profits! Will the acceptance of exorbitant executive pay be our next break through? How are we liking those golden parachutes now?
Still got a ways to go, however, little two faced libbies, to get to George W Bush’s high of 14,162.
Betcha don’t make it.
Tiberius - pulling the tail of the left AND right
February 1st, 2013
7:10 pm
Indigo is yet another in a long line of libs who thinks they know everything about people they’ve never met, despite everything they’ve written to the contrary.
We usually call them ignorant race baiting liberals, but those are redundant terms.
Of course, he was given a chance to prove us wrong by posting facts to the contrary, but chose to continue his ignorant screed instead.
Aesop's Fables and other Lib Economic Theories
February 1st, 2013
7:13 pm
Keeping with the spirit of Friday night -
http://www.youtube.com/watch?v=C53QAuOoSgc
JamVet
February 1st, 2013
7:14 pm
Bruno,
A nice cover of a great TR song…
http://www.youtube.com/watch?v=a9LtwlPGYn8
Bruno
February 1st, 2013
7:15 pm
In the words of Paul Simon
http://www.youtube.com/watch?v=HvliMzAFWHM
Here, indigo, let some of Paul’s cool rub off on you. It might help.
Bruno
February 1st, 2013
7:17 pm
Hey, Brother J!!! Thanks for coming by. I think Ti was getting lonely without you. He seemed to be a little grouchier this week.