Stocks Soar After Bernanke Comments; Dow Rallies Above All-Time Closing High
Source: CNBC
Stocks spiked sharply across the board Thursday, with the Dow and S&P 500 crossing above their record closing highs, after Fed Chairman Ben Bernanke emphasized the central bank intends to keep its stimulus measures for the foreseeable future.
The Dow Jones Industrial Average surged nearly 150 points, rallying above its all-time closing high of 15,409.39. All 30 components traded in positive territory, boosted by Caterpillar and Disney.
The blue-chip index's point gain for 2013 is already greater than any year on record.
The S&P 500 was higher for a sixth-consecutive session, briefly crossing above its record closing level of 1,669.16. The S&P 500 is now on pace for its biggest weekly gain since January.
Read more: http://www.cnbc.com/id/100879524?__source=yahoo
This is what Republicans dread: Economic recovery during the Obama administration. The stock market is not the economy, but it is a highly visible leading indicator.
sinkingfeeling
(51,461 posts)Lasher
(27,598 posts)Now I'm starting to wonder.
Some people aren't happy unless they aren't happy.
we can do it
(12,189 posts)JoePhilly
(27,787 posts)If the market drops, its a disaster ... if it goes up, its still a disaster.
UE goes up, disaster ... goes down, still a disaster.
Housing prices drop, disaster ... go up, still a disaster.
Clearly, we live in District 12, and the Hunger Games are about to start.
JoePhilly
(27,787 posts)I used to think folks on the left were a bit more optimistic than those I encountered on the right.
DU proves on a regular basis that I was wrong.
Lasher
(27,598 posts)And guess what, that's more cause for hand wringing.
GeorgeGist
(25,321 posts)The stock market is not the economy, and is a highly misleading indicator.
byeya
(2,842 posts)Lasher
(27,598 posts)dmosh42
(2,217 posts)Any money I have as a retiree is in banks at less than 1/2% interest, but they get more than 41/2% on mortgages and now over 6% for student loans. No wonder these executives are cleaning up while paying less on income taxes than I do. What a corrupt country and why did I volunteer time in my life for the military?
Lasher
(27,598 posts)You can do better than that. Even Savings Bonds pay 1.18%. I have always had my retirement savings invested in the stock market. Otherwise, I'd probably be almost broke by now.
Never make an investment decision based on advice you got from someone like me on the internet.
I'm sorry you seem disillusioned about your time in the military. But at least you had a choice. I didn't. I was drafted.
dmosh42
(2,217 posts)I invested in a technology 'blue chip' for many years, and luckily I withdrew much on retirement, choosing other places to put some money. After that, during that period of the late 90s, my value in that stock was about 18 grand, but things didn't seem right. However, the CEO made a public statement that all was fine, meanwhile he sold 2 1/2 millions worth of stock. Within a few weeks the value was only a few thousand, then hundreds. So, not a big fan of trustworthy corporations. You might say, well there are insider trading rules and other laws protecting the investor. Wrong! All bullshit! I would add that I wasn't disillusioned about my military time, because in the late 50s and early 60s many of us did volunteer as the country had a different attitude, and we did have some trust in our government, and I was always proud of that time. But now we don't prosecute crooks, and we have a very class controlled society, and the inequality of our society is astounding to me.
byeya
(2,842 posts)live on.
In defense of Bernacke, he's doing what he can with monetary policy and he's said that fiscal stimulus is what's needed.
Igel
(35,320 posts)It covers their expenses and their losses while making it profitable to continue to make loans.
But given the weak demand for loans and the Fed's nice rates for overnight loans to banks, there's no pressing reason to offer higher bank interest rates.
The 6% for student loans that you're probably talking about would be charged by the Federal government, not banks. That's not the same "they."
wordpix
(18,652 posts)while keeping bank interest rates on deposits at less than 1/2%. For doing basically nothing, banks will really make a killing on this legislation.
The latest Senate deal is to cap the loans at 8.25% for undergrads and 9.25% for graduate students.
http://www.nytimes.com/2013/07/12/us/politics/tentative-senate-deal-reached-on-student-loan-rates.html
Roy Rolling
(6,918 posts)How is it that I benefit from my tax dollars being used to lend money to rich multi-national companies? The US is not a charity for the poor and downtrodden CEO with only a $1 million salary.
KansDem
(28,498 posts)http://tv.msnbc.com/2012/12/05/gap-between-corporate-profits-and-wages-grows-to-post-war-record/
Wages just keep "trickling down."
Lasher
(27,598 posts)Regardless, this stock market performance is a good sign. Isn't it?
KansDem
(28,498 posts)30 years ago we heard all about "trickle down" and how making the rich richer means we all benefit. It was a lie. The rich got richer and the poor got poorer.
The stock market is at an all time high--
But who benefits?
Lasher
(27,598 posts)In 2011 54% had stock market investments.
http://www.gallup.com/poll/147206/stock-market-investments-lowest-1999.aspx
NickB79
(19,253 posts)Just because half of all Americans have stocks, doesn't mean that a rising stock market is always a good thing for them.
For example, employees will often cut wages and hours for their employees to improve their profit margins, and the stock market soars on the news.
Does the increased stock income (which in many cases can't be touched until retirement without penalties) offset the present-day wage cut for most Americans? The answer appears to be no.
KansDem
(28,498 posts)I'm neither an investor nor a stock-market analyst but it appears to me it's going the wrong way...
Lasher
(27,598 posts)Damn the stock market! It would be much better if we could have a crash like in 1929. Boy dat Great Depression wuz some wonderful years, huh? Bring back dem good ol' soup kitchens and bread lines, yessir!
KansDem
(28,498 posts)And Trickle Down did nothing to prevent them.
It would be much better if we could have a crash like in 1929 -- Doesn't matter. Wall Street will once again receive bailouts and bonuses courtesy of the American taxpayer.
Psephos
(8,032 posts)Pols like that a lot better. No grim photo ops.
tularetom
(23,664 posts)Market performance may not mean a great deal to most Americans in real terms, but it makes people feel positive about their financial futures. When they feel this way they spend more money. When they spend more money the "real" economy actually benefits.
JoePhilly
(27,787 posts)Lee-Lee
(6,324 posts)Is that the market is truly hooked and running on corporate welfare and if we want to keep the illusion of recovery going we have to keep propping up the ultra rich companies.
Scurrilous
(38,687 posts)K & R
Ble.
upaloopa
(11,417 posts)from Wells Fargo and increasing equity in my house. I am one of the lucky ones.
I have the bad feeling that the economy is improving but it is leaving so many behind who will never recover.
I can't cheer too much until everyone can enjoy the benefit. I fear that won't happen this time.
MrSlayer
(22,143 posts)Somehow I don't see that happening. I do see a lot of hoarding and offshoring though.
I'm glad someone is doing well. I guess.
demosincebirth
(12,540 posts)"hard hits" the working poor and the unemployed?
muriel_volestrangler
(101,322 posts)In the long term, we need to use less.
demosincebirth
(12,540 posts)You know, about the "use less gas" is the patent answer of many who have never been in the position of a certain type of hardship where there is no public transit you can take and the only way to work is to drive to a miserable job every day and watch, and hope, that gas station doesn't raise its prices the next day. Sorry to rant on you, but I've heard that phrase so often on DU that it's like finger nails on a chalkboard to me.
muriel_volestrangler
(101,322 posts)We have to use less gas to
(a) stop ruining the climate, which has the potential to kill far more people from poverty than the price of gas
(b) decrease the demand for gas, because if there's less demand, then only the easily accessible oil will be extracted, which would mean lower prices.
My message for someone commuting 40 miles a day is use as little as possible, and elect politicians who will set up a decent public transport system. But don't expect gas prices to go down, unless there's another recession - the world also wants to use that gas, and that's what keeps the price up.
demosincebirth
(12,540 posts)dtom67
(634 posts)My impression used to be that the stock market went up based on Fundamentals, Like earnings and such. Now it seems like, any time the Market dips, Big Ben just grabs a mic and says:" More QE ! " , and the market goes up.
...
PSPS
(13,603 posts)The days of using the stock market as an economic indicator are long gone what with front-running computerized trading, insider trading, the "plunge protection team" and the promise of continued propping up with free money from the fed (with the US treasury/taxpayer as the backstop for bailouts.) When we stop seeing some P/E ratios close to 100, let me know.
The stock market lost its connection to the fundamentals about a decade ago, and for good it would seem. As you said, for starters just look at the P/E ratios.
NoOneMan
(4,795 posts)Stock market plummeted, there was a bond-market sell off, and the dollar soared.
And now the Fed is reassuring everyone the easy money is here because the economy isn't so hot (growth was revised down to 1.8% last Q).
No, this isn't a sign of a recovery. Its the opposite. A sign of dependence on easy money that a staggering economy needs
byeya
(2,842 posts)have stymied any sane and productive fiscal stimulus so we're stuck with pot holes, crumbling bridges, and a temporary surge in the stock market and a continuing semi-rally - after a real 30 year rally - in the bond market.