Has anyone checked the Dow lately? I realize that consulting the Dow is the worst piece of advice a broker or financial planner would give to clients these days. When times are tough and the economy is on the mend, most analysts will tell you to take a vacation away from your stock portfolio until you have a good reason to look at it again.
But the NYSE closed recently once again under 10,000. In fact, it’s hovering around 9,700 and trending in the wrong direction. I had to chuckle last week when the Dow tipped up a few percentage points on news Congress had passed a sweeping financial services overhaul. Many in the media said that was because financial institutions such as banks would now have some sense of direction as to how their industry would be regulated. Yet like many policies of this administration, the security and sense of direction lasted about as long as a teen-induced sugar high.
The market is trying to tell us something folks! This economy is headed in the wrong direction. And no matter how hard he tries, Obama can no longer lay this at the doorstep of his predecessor. I know every morning the Administration has some intern who scours the papers just for the current mess du jour - more governing by victimization.
If such moves were part of a larger correction that many analysts say was needed, then I would be less apt to point a finger at the White House. But such market fixes should have taken place months ago. What we have here today is more tinkering by the federal fiat. If anyone outside Washington actually believed Congress’s steps through “overhaul” last week would yield any positive benefits, then forecasts for Q3 and Q4 of this year would be far better. And still, they are not.
However, Americans aren’t fooled; the real victims of this economic mess are the unemployed. Although unemployment figures hover around 10 percent, which has been seen as a sign of hope for those who are desperate to find one, unemployment benefits saw a recent increase. This indicates that companies are still laying off people, and those people are now becoming a burden to their government. Such contradicting information can sometimes be confusing in an already complicated market. We can’t just look at one indicator to determine the growth or decline of unemployment.