03-06-2009, 05:46 PM | #11 | |
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If the Dow is not a barometer at large for the economy, why don't you educate us.
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03-06-2009, 05:58 PM | #12 | |
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Nate Silver has an excellent post on the topic, if you are actually interested in moving beyond the rhetoric and into thoughtful analysis. http://www.fivethirtyeight.com/2009/...nks-about.html |
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03-06-2009, 06:29 PM | #13 |
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Interesting read, thanks for the link.
But back to the Dow - I think we can say that it's a pretty good barometer for the general confidence that the public has in the economy and the fact is and it seems every time Obama opens his mouth about the economy, the Dow drops. IOW, folks don't think Obama is going to make things better. That's really all that matters, isn't it?
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03-06-2009, 06:42 PM | #14 |
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The Dow is an Obama tracking poll. And he's been trending down pretty much since his election.
Someone should let him know what P/E ratio stand for, too.
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03-06-2009, 06:53 PM | #15 |
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03-06-2009, 07:06 PM | #16 | |
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Example: AIG required a bailout in 2008. AIG was a Dow company. Once their financial troubles became known, AIG was removed from the Dow and replaced with a company whose fortunes were far superior to AIG's. Did the general public confidence grow tremendously in the Dow on the day it improved due to the removal of AIG from the Dow? Or was that just an arbitrary shift? |
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03-06-2009, 07:11 PM | #17 | |
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"The beauty of baseball is not having to explain it." - Chuck Shriver "This is now the joke that stupid people laugh at." - Christopher Hitchens on IQ jokes about GWB. |
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03-06-2009, 07:12 PM | #18 | |
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The Dow folks try to keep the Industrial average roughly representative of the American economy, which is why two Nasdaq stocks (Microsoft and Intel) got added a decade or so ago .... to represent growing Tech influence. A perfect barometer it is not. No such thing exists. But it is one of several decent indicators of economic confidence, and one that Obama's failing badly right now.
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03-06-2009, 07:22 PM | #19 | |
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03-06-2009, 07:29 PM | #20 | |
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The Dow is irrelevant and heavily reliant on cyclical stocks. And the stock market, in general, is one of many indicators of economic confidence, not the sole or primary indicator. Read up on it. I know Wikipedia is your only source of information, so I saved you the trouble: http://en.wikipedia.org/wiki/Economic_indicator |
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