Dow Average Surpasses Record High as Market Opens

[onehandle]

Last edited Tue Mar 5, 2013, 11:19 AM - Edit history (2)

Source: New York Times

Despite everything, the stock market is back at a record high.

The Dow Jones industrial average, which measures the performance of 30 blue-chip companies, rose more than 80 points at the start of trading on Tuesday, to 14,207.94. That surpasses its previous record close of 14,164.53, which it achieved nearly five and a half years ago, as well as its record intraday high, set around the same time, of 14,198.10.

Of course, a few things have happened since October 2007. The housing market collapsed, the financial system went into meltdown, the European Union started to fray and politicians dragged the United States through an on-off-on-again fiscal imbroglio.

But stocks managed to shrug it all off. Since a low point in March 2009, the Dow Jones index has more than doubled, stunning even the most seasoned stock market watchers. “What’s amazing about this bull market is that people still don’t think it’s real,” said Richard Bernstein, chief executive of Richard Bernstein Advisors, a money management firm. “We think this could be the biggest bull market of our careers.”

Read more: http://www.nytimes.com/2013/03/06/business/daily-stock-market-activity.html

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Hey 'Job Creators' who have More Cash On Hand Than Ever and the Highest Profits/Stocks of All Time...

WHERE ARE THE JOBS!?

[sinkingfeeling]

1. Apparently, Wall Street isn't bothered by either reality nor the spending cuts.

[Botany]

2. But I thought the economic uncertainty caused by Obama's health care would kill the market?

Fox News:

A massive wave of regulations has been kept on hold until after the election so as not to
cause Obama any political problems before the election.

If you believe that government spending is the way to create growth, you will be happy with
what will happen over the next four years. But Obama doesn't believe in incentives, and
penalizing Americans for working hard and taking risks means that the US rank will slip further
behind the rest of the world.


Read more: http://www.foxnews.com/opinion/2012/11/07/what-can-expect-for-america-economy-in-second-obama-term/#ixzz2Mg2nkTpw

[denverbill]

3. I blame that communist, Marxist, Leninist, Stalinist, socialist in the White House.

After all, investors are putting their money on the line because they think Obama is going to nationalize everything and turn the US into the Soviet Union.

[Mutatis Mutandis]

4. This is very simple to explain. When trillions in new money are printed via QE, etc, they have to go

somewhere. All you are seeing are the equities and the housing markets once again being inflated like a cheap balloon. When these burst again, this time it will explode into a world that is rife with massive and multiple sovereign debt crises, systemic instabilities baked into the cake via the doctrine of 'too big to fail', and social/political environs merely a random match-toss away from tinderbox territory in most of the West.

The Fed, the ECB, the IMF, World Bank, BoE, BoC, BoJ, BIS , etc are now reduced to one-trick ponies. PRINT PRINT PRINT, till hyper-inflation overtakes the present fiat monetary system in a deluge. Whether this happens in 2 years, or 10, happen it will, and I hope that all who can do so truly have started to obtain true, viable wealth, be it physically allocated and vault-held PM's, real estate, etc, as life preservers for the coming flood.

[Botany]

6. R you a prepper?

[Mutatis Mutandis]

11. I 'prep' via a combination of short-term trading & long term portfolio building, are you a prepper?

I don't fight the markets, I buy the dips, sell the rises. If a stock screams to be shorted, then I short it, and the reverse in terms of undervalued equities. Am I perfect, hell no, I have taking some poundings, but overall, I am quite well satisfied so far.

My core long-term holdings consist of physical metals, productive real-estate, some select, dividend-paying blue chips, a wee bit of laddered bonds (anyone in a managed bond fund now is asking for the butcher's knife), some diversified currencies, etc. I play a bit in the global exchanges, and my partner has had multiple successes in the FOREX markets. I do not have the stomach for FOREX trading, as I am more long term in outlook.

I reside outside the USA, thus I have one leg up when it comes to security issues arising from breakdown crises that are American in origin, and have several geo-diverse places where we can go reside, should I choose to and the situation warrants it.

We are all in the midst of a global fiat currency extinction event, and I do not pretend to be able to call the date and exact events that will trigger the maelstrom. That said, throughout 7000 years of recorded human history, all fiat currencies have died, and almost always are followed by violent, systemic geo-political conflict. This time will be no different.

"History does not repeat itself, but it surely does rhyme."
Mark Twain

[aristocles]

15. Thank you. A voice of reason. n/t

[earthside]

7. I'm not excited.

This is precisely correct.

The 'roaring' stock market is a separate phenomenon from the reality in which 99 percent of Americans spend their daily lives. The 'markets' are where micro-gambling goes on; where hundreds of billions of QE dollars are funneled to the .05 percent; and sadly, where a lot of Americans have to watch almost helplessly as their 401K funds are whipped around by insiders and the .025 percent.

Frankly, it is disappointing to me to see Democrats and progressives trying to hold up the Dow as some kind of vindication for Obama policies -- especially when we still hover around eight percent unemployment and taxes and fees and premiums and inflation further erode what little spending power middle and working folks have left.

The Dow reaching its former high is, in my opinion, not a reason for celebration, but just a tragic reminder of our bifurcated economy.

[Psephos]

23. A concise and accurate summary. n/t

[roxy1234]

36. Also this may not be roaring as much as we think

Get someone to adjust the DOW to inflation to the dollar value of the last time the DOW hit a high and then we can see if we are really seeing a record high. But I agree that all the money flooding the markets is what is distorting the markets.

[MannyGoldstein]

5. Accounting for inflation, only 1,500 more to go to breakeven

I wish that the 90% were so close!

[Nye Bevan]

10. How about if you include reinvested dividends? (nt)

[Kolesar]

18. I think dividends are taken into the account with the S&P and Dow

Thus, an "S&P index fund " that reinvests its dividends will track the S&P index.

The calculations would be crazy without counting dividends because companies have different dividends, special dividend, and some pay no dividends.

:. no inflation salvation

[Nye Bevan]

22. No, those indexes definitely do not include dividends.

If the S&P index stays at a constant level, you will still make a profit from an S&P index fund, because of the dividend income.

[mpcamb]

8. Really? Things are great? Then why

Is everybody hurting so bad?

[leftynyc]

9. Worst socialist ever

So what's the business people's excuse for not hiring going to be this time?

[Mutatis Mutandis]

12. speculative bubble wealth does not, nor will it ever equate to capital formation in a usuable form

Look at fundamental indices for a partial view of the underpinning 'hiring businesses' abilties to expand, or at least retrench in terms of employment generation.

[leftynyc]

17. Are you calling

record profits a speculative bubble? Seriously?

[Psephos]

24. Are you not?

They will evaporate overnight when the music stops playing.

Funny money (fiat currency) has a 100% failure rate in economic history. Think about it.

[leftynyc]

25. Are you talking about the stock market

or the actual record profits these companies are claiming?

[Mutatis Mutandis]

28. if you think this Dow bubble is being driven by fundamentals like so-called 'record earnings'

and NOT by tidal waves of printed-from-thin-air money that is in search of anywhere to park itself, then I strongly suggest you look at the the PE ratios of the biggest oil companies in the world (who have been enjoying the biggest profits in the history of modern stock market).

[leftynyc]

31. I know all about P/E ratios

The stocks I have the vast majority of my 401k's (I have two) are in stocks with P/E ratios between 16-18 - very healthy companies. A very large chunk is in one particular stock that was for a corporation I worked for in the 90s and when I moved, I kept the money in that plan as the stock was doing great even then. When I got into it it was $37, I've been through 2 stock splits and it is now trading at around $160. I may be able to retire one day.

[Mutatis Mutandis]

32. here's to retirement!

[leftynyc]

33. I'm hoping that in 15 years

when I'm 67, I'll be in enough good shape so I have roof over my head and food in the fridge....not really asking all that much.

[Mutatis Mutandis]

34. best of luck to you, just make sure you have some inflation hedges in the tank

The next 15 years are going to be quite very very ugly, unfortunately. That said, I do have an undying belief that the 'better angels' will win out, provided we can push the banksters back into their pits. Somewhere along the lines, a global debt jubilee is going to take place, hopefully peacefully.

[aristocles]

13. Where are the jobs?

Take a look at unemployment rates as reported by the BLS for December 2012:

http://www.bls.gov/web/laus/laumstrk.htm

Apparently the job market is pretty fair in some states.

EVERYBODY is not hurting.

That's a exaggeration and an over-generalization. The reality is more nuanced. Where are the jobs? Where there is the set of skills that match the jobs available in today's economy. Are you willing to move to a state where the jobs are? Willing to train or re-train for a new career? Have an entrepreneurial instincts...start a new business?

Even with unemployment at 7 to 8 percent, 93 to 92 percent do have jobs.

[Mutatis Mutandis]

29. "Even with unemployment at 7 to 8 percent, 93 to 92 percent do have jobs"

Blatantly untrue. Workforce participation levels are at all-time post WW2 lows.

The headline (U-3) unemployment rate is a cruel, completely manipulated hoax, massaged, adjust, and corrupted to the point of irrelevancy.

http://www.zerohedge.com/news/2013-01-17/does-look-recovery

1. In the US, while the official unemployment rate is falling, a much better indication of the labor market is the Labor Force Participation Rate– the percentage of people within a society who are engaged in the work force.

It rose steadily for decades after World War II as more and more women entered the work force, peaking in the late 1990s/early 2000s. It has been in terminal decline for the past ten years, having now reached the same level as from the late 1970s.



Mirroring this point is private sector data from Automatic Data Processing, the largest payroll services firm in the world. ADP regularly releases its own employment data– they are, after all, the ones who send out the paychecks...

According to ADP data, the number of people employed in the United States today (111 million) is roughly the same as in 2001. Yet back then, there were about 285 million people in the US. Today there are 315 million people.

[dmallind]

35. That's what happens when more populous cohorts hit retirement age - that chart is 16+ not 16-65. nt.

[Remmah2]

14. This is nice but only good if you have a job and a mutual fund/stock.

For the unemployed or soup kitchen customers I can't see this helping them.

[AllyCat]

16. And it's all the fault of that Socialist Obama!!

And right, where ARE the jobs??

[jzodda]

19. The Rich get Richer

It has never been more true than today. If ever there was a reason to reform the tax code to eliminate loopholes and deductions its now. Why the hell shouldn't we with a market this high? Also increase those capital gains taxes please to 30% or higher. Time for those slimy hedge fund managers to pay their fair share.

[OKNancy]

20. and so do the retired and soon to be retired

I have a tiny self funded IRA. It's all I have over and above Social Security.
A good stock market is good for people like me.

[jzodda]

27. Well...

I am not rooting against people like you. I want the market to do well for everybody- but having said that we need the reforms I spoke of- They certainly aren't target towards folks like yourself.

[OKNancy]

21. Still booming...

[kelliekat44]

26. They don't care about jobs! Their work is passing money around to each other and skimming a "take"

from the house.

[Fringe]

30. This helps me tremendously.

I know that everyone is not doing as well, but I'm glad there is at least a safety net for those who need it.

My 401K has been doing great for the last couple years. I don't retire for another 9 years, no telling where it will be at that time, but I'm happy about the market for now.

For the last 3 years I haven't made a lot of money, but I'm frugal, and I contribute a large portion of my salary to my 401K. Next year, I'm expecting a raise and plan on maxing out my contribution for the year.