Wednesday, October 14, 2009

The DOW breaks 10k

Wall Street cheered today as the stock market broke over the 10,000 mark (DOW Jones Industrial Average). I suppose it's nice to have clawed our way back to where we were 10 years ago.

I feel so much better off now. Don't you?

In the meantime the dollar lost 20% of its value against foreign currencies (US Dollar Index) during the Bush Administration and after a short lived rally over last fall / winter during the great panic of '08 it has resumed its slide. The dollar is down around 16% since March! In the stockmarket a comparable slide would be worrisome. But when your currency drops 16% in six months that's a giant neon sign flashing a one word message...

2 comments:

Reactionary said...

Where are the earnings supposed to come from to support these higher share prices? What in the fundamentals has changed, I mean, other than politically-mandated wealth transfers to Wall Street and General Motors?

Sucker's rally.

edwin sanchez said...

Sometimes I feel like everybody treats the market as such an abstract impersonal concept… and it is in a sense. It represents the supply and demand of money free for investing I suppose. But what about the pure heart of it - at the core of the stock market isn’t it just someone giving someone else money to do something with it in return for a portion of the hoped for profit?