I'm not an economist so maybe one of you can explain this to me.......

[Lipton64]

http://finance.yahoo.com/q/hp?s=%5EDJI&a=00&b=1&c=2000&d=11&e=9&f=2006&g=d


This is a list of the highs and lows of the Dow from Janurary 1st, 2000 till yesterday. I've been hearing all over FoxNews and Limbaugh and Matt Drudge and the whole right-wing radio "lobby" that "the economy is at the best it's ever been" blah blah. But what I want to know is this:

If we just passed where were were SIX YEARS AGO - then how the hell can we be doing good? And do these idiots not understand a little thing called "real money?" As in you have to adjust the market for real terms before you compare it to a past score??!?! Obviously they didn't do that from what I've seen there.

And not to mention how the fuck can the economy be good when gas prices were still $1.50 where I lived in 2002 pre-invasion of Iraq and now they're $2.30 and rising. Do these idiots realize that's a non-adjusted increase of 80 cents over just 4 years? In 1991 my gas was 95 cents a gallon where I lived. That's an increase of only 55 cents from 1991 to 2002 non-adjusted.

I mean I can't even buy a 12 ounce soda at the gas station any more for under $1.20 and that's on the cheap end. Food prices have spiked. Housing has literally surged in value.

Did these idiots actually take housing, food, and energy out of the inflation equation?? Please, if there are any ACTUAL *PROFESSIONAL* economists here, and I mean you do this shit for a living, then please explain this to me.

Since gasoline was $3.02 where I lived in July -- meaning I experienced over a 100% increase in cost over the past 4 years -- doesn't that mean that we've seen massive inflation??

And if the Dow and other components of the market are just *NOW*(!!!!) getting back to their "internet bubble" hey-day under President Clinton's watch - then doesn't that mean that we were just in a 6 year recession?!??! I've heard the past 3 years have been an economic boom but from what I've seen with the devaluation of the dollar with respect to other currencies and also the rapid spike in housing, food/drink, and energy costs(and shit, that's not even including health care or insurance!!) then aren't we JUST NOW getting out of a recession that Dubya helped guide us through??

Maybe I don't understand economics but to me when the stock market is just NOW getting back to where it was 6 years ago in non-adjusted-for-inflation values, doesn't that mean it was in a dip and a recession? Because believe me, unlike what the BushBots would have us believe, the economy is not very good -- especially for the working class and the poor. But above all that - I recall when I was in high school still in the late 90s that several of my teachers had invested and were "playing around" with the market and were doing remarkably well.(one teacher cleared 120 grand!!)

Now that's economic growth to my eye when the middle class can invest in the market and walk away in a very short time with a nice profit instead of having to wait 25 years for a decent profit.

Call me fucking dumb but I'm going to say we're still in a prolonged recession that has gone on since Clinton left office and we're just now beginning to climb out it.

Am I incorrect in saying this? Please let me know. Thanks.

[left of center]

1. No, they just lie

Since perception is reality in economics, a lot of economists and right wing idealogues are optimists, but in laymen terms, that just means they LIE when things are not going well!

[Lipton64]

2. Tell me about, and I didn't even discuss college tuition or insurance or health care....

Health care rises each year at twice the rate of inflation while college tuition surges past and leaves the poor and the middle class with no opportunity out of the shanties and ghettos and trailer parks except from serving time in Iraq.

Insurance rates are nuts and for a driver under the age of 25 "liability"(meaning the under-25 person pays most of the damages in the accident) costs a hefty chunk of a worker's monthly wages/salary.

We're destroying our middle class one family at a time and just wait 20 years and our middle class will be a husk of what it is even today.

[Indiana_Dem]

3. They don't include food and energy into the equation.

I think it's inflation where they exclude these. I'm not an expert but I've been following it the past few years.

[Spider Jerusalem]

4. The stock market is not a good general indicator of economic health.

And times when the middle class are investing in the market and reaping healthy windfalls are, generally, NOT economically healthy times at all; that sort of market activity has traditionally been an almost certain sign of an economic bubble that's pretty much bound to collapse in fairly short order (the South Sea Company bubble of the early 1700's, the railroad boom and resulting bubble after the Civil War that led to the financial panic of 1873, the 1920's market boom leading up to the crash in '29, the tech bubble of the 1990's, etc). Generally, when joint stock companies are seeking investor capital from the so-called "man in the street" rather than from the investor class, it means that the market is both saturated and overcapitalised and a good many of those companies are going to go under.

And the price of gasoline is tied to other things than the inflation index; there's a limited quantity of petroleum available, and demand has increased significantly over the past six years, mostly driven by the expansion of China and India's economies. Simple economics: any time there's greater competition for a limited resource, the cost of that resource goes up. And since most transportation, especially in the US, runs on petroleum (diesel locomotives and trucks, diesel-powered freight vessels, etc), an increase in the cost of petroleum means an increase in the cost to ship manufactured or agricultural goods, which means higher prices for everything (above and beyond the base rate of inflation).

[bicentennial_baby]

13. spot on

thank you :)

[TahitiNut]

5. I personally regard the S&P500 a better indicator of the stock market.

The Dow Industrials only include 30 stocks - typically regarded as the safest and the largest companies. As such, it's where some investors (greater fools?) 'run' when there are bears in the marketplace. The S&P500 accounts for the majority of publicly-traded industries in the country, employing the most people on corporate payrolls.

The S&P500 has yet to fully regain the levels it held prior to the Cheney/Bush regime.

[MattSh]

15. Better, but not the majority.

The S&P500 accounts for the majority of publicly-traded industries in the country, employing the most people on corporate payrolls.

The Wilshire 5000 is much more comprehensive.

[TahitiNut]

16. Yes, I misspoke/mistyped there. I was focused on the number of employees.

Sorry. :hi: Yes, the Wilshire 5000 really is a good, comprehensive index.

[Heewack]

6. Very complex answer

And unfortunately I can't get into it tonight, but yes you are pretty much off on your conclusions.

[southerncrone]

7. You don't have to be an economist to realize they are just babbling about anything to avoid talking

about Iraq & the mess in Washington. Plus their job is to brain-wash the shepple that adore them.
Quite frankly, I think they are bragging because their (neocons) economy is the best it's been in years. Insider trading, $ made off the war,etc. They can buy up real estate that is now going down in value after it was inflated by bogus loan practices & now working folks are losing their jobs and defaulting on the loans.
Keep in mind that when unemployed folks run out of their eligibility for unemployment benefits, they simply disappear from the data! Poof! Just like they don't exist anymore. This keeps the figures looking much more positive than our reality actually is. The unemployment figures only include "current" unemployed people, or those whose eligibility has not run out. It is VERY DECEPTIVE! :thumbsdown:

[Union Thug]

8. Bottom line: Wall Street and Main Street don't have much in common.

What I know is what I see around me, so I do not listen much to the pontifications of few wealthy robber barons and their drooling minions. And what I see in no way indicates a boom for the working stiff. So, if a few rich assholes rake in the bucks, the entire economy must be doing great, right?

Wrong.

[Hippo_Tron]

9. The economy is supposed to be better than it was last year, because our population grows

So basically if a President can't boast that the economy has grown under them that means that they have either presided over a depression or a genocide.

There's another key that the rightwing morons miss: distribution of wealth. Under GOP policies economic growth is mostly benefiting the rich, not the middle class and certainly not the poor.

[Porcupine]

10. Inflation is indexed to Ipods, cell phones and computer memory....

so the economy is doing GREAT!!!

Don't worry about housing, food, transportation, health care or education costs. They are transient and token costs for the ruling class and therefore are excluded from ecomonic calculations.

We are getting screwed. Wholesale.

[SoCalDem]

11. The "experts" deliberately EXCLUDE the very things that rise

the MOST , and pretend that 'everything's hunkey-dorey'.

You are not supposed to notice that tomatoes are $3 a lb or that hamburger is $3 lb or that EVERYTHING you buy on a regular basis has TRIPLED, yet your salary is not keeping up..and may even be going in reverse...

You little ingrate.. after all they have done for you...how dare you even question them,..

Why do you hate America??

:sarcasm:

[leftofthedial]

12. we're not climbing out of anything

we've been in recession (not technically, but in fact) continually since the coup of 2000. They've lied and manipulated and lied and lied and lied. Now things are so bad they can't lie anymore.

Just like Iraq. Just like the "war" on "terror."

Lies and lies and lies coming home to roost.

any country that allows repukes to rule is screwed. We've allowed them to rule for almost all of the last 25 years. We are SCREWN.

[MattSh]

14. The Dow and inflation.

Before the current surge, the Dow Jones average closed at an the all-time peak of 11,722.98 on January 14, 2000. Now it's at 12,307. That would be nice, except it has not been adjusted for inflation. The simple inflation rate since 01/2000 is around 20%, adding the rate of inflation for 2000, 2001, 2002, etc, together. (Of course, inflation compounds, so the actual accumulated inflation rate for this period is actually higher than 20%). But using the 20% number, the Dow Jones index would need to reach 14,067 to be in the same place it was on January 14, 2000. So, adjusted for inflation, the Dow is still well BELOW it's all time high. And even if it reached 14,067, it would be in the SAME PLACE as 01/2000. The idea behind investing is to come out ahead, not in the same place the last time I checked.

And, the Dow of today is not the same Dow as in 2000 anyway. On April 8, 2004, change occurred as International Paper, AT&T, and Eastman Kodak were replaced with Pfizer, Verizon, and AIG. On December 1, 2005 AT&T's original T symbol returned to the DJIA as a result of the SBC Communications and AT&T merger.

Oh, and keep in mind the inflation rate is always managed downward too. No president wants inflation to skyrocket under their watch.

And this is coming from a non-economist.

[skids]

17. We are not beginning to climb out of it...

...even a Dem congress isn't going to fix the bad economic fundamentals. It's all downhill from here, at least to those of us who know how much a dollar (and thus, dollar-denominated stocks) is actually worth. I'm sure as the dollar bellyflops the DOW will "hold it's ground" but the number is meaningless except for those people who don't believe in inflation.

[area51]

18. Economy

I think the best measure of how an economy is doing is: are there enough jobs to go around for everyone who wants one? Are those jobs well-paying? Do they offer bennies? Are they full-time, or are the jobs offered part-time and/or contract only? It's obvious, from looking at internet job listings and in the newspaper, that the econonmy is in terrible shape. I think we're in the 2nd Great Depression, and I fear the Democrats aren't going to do anything to stimulate job growth in the U.S.

[Gregorian]

19. War jacks up the Dow. It's great business.

Here's an abbreviated version of the lyrics from one of my favorite tunes that was done by Fear. Lee Ving was way ahead of his time.

Let's have a War
So you can all Die.
Let's Have a War
We can all use our Brains.
Let's Have a War
Redeem this space.
Let's have a War
We have this place.
Let's have a War
Jack up the Dow Jones
Let's have a War
We can save New Jersey
Let's have a War
Blame it on the Middle Class
Let's have a War
Like rats in a cage.
Let's have a War
Sell the rights to the networks
Let's have a War
Nevermind about that last time.
Let's have a War
Give life a little twist.
Let's have a War
The Enemy's Within..