Does the Record Dow Matter?

Wednesday, March 06, 2013

The Dow hit a record high yesterday, but other economic indicators show lower wages and diminished household wealth. Dan Gross, columnist and global business editor at Newsweek and the Daily Beast, discusses what numbers really describe the overall state of the new US economy, and who stands to benefit and get left behind.


Daniel Gross

Comments [30]

carl from queens

Most companies have become parasites. Taking advantage of a weak economy, weak unions, pay their employees a non livable wage. Along with a fed. that lets them borrow money for nothing, thereby creating record profits, at the expense of savers who rely on a fair return on their money to live. The market had no place to go but up since 2009. When the fed throughs money at everything, no matter how bleak things look, buy stocks with impunity. What burns be up the most, is when these parasites have so much money that they don't know what to do with, they buy paintings for 36 million bucks, while their workers are driving 20 year old pickup trucks to work. Or when they are willing to spend over a 100 million on any candidate who is willing to get us into another war of their choosing.

Mar. 06 2013 01:02 PM

Brian, "natural market forces at work?" What a patently absurd question.

You mean Gramm-Blailey-Leach legislation removing derivatives an open regulated market, 20+ years of non-regulation, lack of law enforcement & destruction of SEC documents because they could be used to show a pattern of cheating customers, insider trading, front running, etc.

+ GBL removing the last vestige of Glass-Stegall.

We are still in a man-made disaster of job loss, stagnant wages, etc. The lack of current law enforcement & regulation will make the next act even worse.

Mar. 06 2013 11:10 AM

Federal Reserve's nearly 100 year history was posted on Senator Sander's webpage.

Sorry for the garbled link. It had split at a hyphen.

Mar. 06 2013 11:03 AM

So why don't US workers just start their own businesses and make things & profits locally?
Regulation of everything by governments and agencies can shut down almost anyone who is so naive as to try.
The regulators are often in the pockets of the big guys you are competing with.

Mar. 06 2013 11:00 AM
John A

The Sanders link you posted below is garbled.

Mar. 06 2013 10:55 AM
Creeda from nyc

wow, talk about amateur hour at wnyc with this segment.

BL sounded like a wide eyed schoolboy asking naive questions, and the listener-caller simply sounded weak frustrated. You never hear people in a position of power speak of revolt (unless it's taxes, I'm looking at you Bloomberg)...and besides, who would sit at home and watch the top rated television of america shows if we started a revolution?
And would generous donors give to WNYC is we started revealing how truly rotten the link between money and politics and power and government Are.

There is a false credulity that there is GOOD to be found in the business of money making (not to be confused with Services that are profitable).
I could learn more about why the DOW is up and what it means in my world from watching a third rate fictional movie such as Money Never Sleeps.
Sorry, this interview was a amateurish.

Mar. 06 2013 10:47 AM
fuva from harlemworld

People are not in the streets, because they are
-- on the web
-- on the couch
--- playing video games
--- watching one (or more) of hundreds of channels of "reality tv"
-- texting or whatever, on some gadget
-- etc.

The guest has it wrong. Regardless of what's going on in Greece, etc., folk have it bad here in America, according to AMERICAN standards and expectations.

The problem is that folk
-- are distracted/doped up on push-button dopamine. E.g., the under-paid, under-employed dude today is either a already a sucker for the "smart"phone racket or is trying to be. He is likely more focused on getting a "smart"phone than getting a fair socioeconomic shake...The zeitgeist is under the control of these media.
-- are too remote. The remote -- messageboards/skype/youtube/facetime -- culture precludes the catalyzing energy/info exchange of in-person contact that might shake us out of this daze. THE REVOLUTION WILL NOT BE DOWNLOADED.

(And, Brian, yes, you owe Joseph an apology. You should do it on air, at some point. He advocated violence not once. I wonder why you assumed he did.)

Mar. 06 2013 10:41 AM
The Truth from Becky

Of course it is now recorded in history, but because the President may get some sort credit, it will be downplayed.

Mar. 06 2013 10:39 AM
RUCB_Alum from Central New Jersey

DrG - Please go sell your FoxNewspeak elsewhere.

Averages wages have been detached from the nation's overall economic growth, i.e. The Rich get to take it all, since the 1960s. Look at what an hour of labor buys today compared to 1968 levels.

The 'cure' is a deflation, where wages and other assets are allowed to re-order themselves...Don't hold your breath, it ain't gonna happen. We prefer asset bubbles that affect only one or two segments at a time. And we use public money to make the bad guessers whole if they are too big to fail. Households are helped far more modestly, if at all.

A longer term fix will be to punish employers of illegal labor and push wages up faster than the GDP. Be prepared for the inflation that ensues. But if the current distribution of 'fruits' is perpetuated, what difference will it make?

Mar. 06 2013 10:36 AM

Profits are expatriated because we have the world's highest corporate profit tax rates.
This rewards deals that structure profits to be realized in lower corporate profit tax rate jurisdictions, abroad.
So there is less money here to pay US workers.
Some might say this is a stupid way to tax.
The more conspiratorially-minded might say it is part of a war on America's middle class, who, when prosperous, are an obstreperous impediment to would-be tyrants.
Prosperity reduces dependency on governments & politicians.

Mar. 06 2013 10:34 AM
Michael M Thomas

Former columnist for NY Observer.
You might look at this apropos of your conversation with Dan Gross.
It also pays to reflect on Stein's Law - that if something can't go on forever, it won't. The same may apply to tolerance for gross economic inequality, considering how that inequality comes about, how wealth is piled up (to paraphrase dan Gross). Interesting to speculate how it might have turned out post 1940 had not the world war intervened.

Mar. 06 2013 10:33 AM
Matt from New Jersey

I work in the public work sector in New Jersey. I have NO problem what so ever switching to a 401 type retirement. First the State has to pay back ALL the money that they dipped into in the State Pension & then reform the system & not be able to steal money out of that fund. They won't ever do that because it would end the easy money that is available to the THIEVES.

Mar. 06 2013 10:31 AM


Mar. 06 2013 10:29 AM


The reason why there aren't any people in the streets protesting here in the US is because too many in this country are in debt. When you owe so much money to the banks, the banks use that as leverage against you.

Mar. 06 2013 10:27 AM

Wow, sounds like they have it all figured out in Haiti.

Makes you wonder why that last caller would ever come to the US.

Mar. 06 2013 10:27 AM
jgarbuz from Queens

The reason why the market has risen so high is because company profits are very strong despite the high unemployment. Business can do well with less labor.

Mar. 06 2013 10:25 AM
Sheldon from Brooklyn

Thanks to food stamps/section 8/ medicaid, the Walmarts of the world get reliable, docile, subsidized labor via the US taxpayers.

Corporate republicans and big business LOVE food placates the masses.

Obama, now that he is safely elected, should try and phase out food stamps. I guarantee you, the GOP house will block him.

Mar. 06 2013 10:25 AM

Americans are not out in the streets protesting because they have been anesthetized by mass media into thinking that they are ok when the opposite is true. Just look at the absurdity of the rise of the Tea Party. Most people who are teabags are being victimized by the system they are supporting. They don't think so if they think at all because they are too busy eating their fattening food, drinking their sugary drinks and playing with their digital toys.

Mar. 06 2013 10:25 AM

The reason people are not in the streets - yet - is that so far it has been death by a thousand cuts and for a minority of people. The system still maintains belief in the myth that you or I can become rich. Probably a majority of people actually have too much money; enough to buy enough toys to keep us too preoccupied to think about inequality.

Mar. 06 2013 10:24 AM

Aybo-bo!!! @the caller Josphe... If only we could come together, we can make things happen!!! But alas...Depi nan Ginen neg, pa vle we neg! We need to change to make a change...

Mar. 06 2013 10:23 AM
Robert from NYC

I agree with Joseph. We need revolution and it's time the puppet american population get out into the streets as you see everywhere else around the world. Get off your bums and get out and revolt. Don't put it down guys it's the American way. Cut the baloney about the standard of living here as opposed to Greece. it's time to prevent it from getting to be like Greece.

Mar. 06 2013 10:22 AM
John A.

Hellooo.. Fiscal Cliff. Fiscal Cliff tells workers that their jobs don't mean so much, so they retrench and take all their discretionary funds and sock them away until their jobs are secure.
Fiscal Cliff Also says that Washington would rather die than to 'hurt' Capital investors to save labor. If responsible taxation were to be called hurting.

Mar. 06 2013 10:20 AM
CB from NJ from new Jersey

Yes, it means a LOT.
It means that the people that caused all the pain and suffering of regular folks have now doubled their wealth at the expense of the middle/working class.
Still not enough jobs. Still MANY homes in foreclosure.

Mar. 06 2013 10:18 AM

Profits are expatriated because we have the worlds highest corporate profit tax rates.

Mar. 06 2013 10:18 AM

Our inflation comes from a huge welfare program to international banksters.
Federal Reserve gave $16.1 Trillion since 2007 to:
Citigroup: $2.5 trillion ($2,500,000,000,000)

Morgan Stanley: $2.04 trillion ($2,040,000,000,000)

Merrill Lynch: $1.949 trillion ($1,949,000,000,000)

Bank of America: $1.344 trillion ($1,344,000,000,000)

Barclays PLC (United Kingdom): $868 billion* ($868,000,000,000)

Bear Sterns: $853 billion ($853,000,000,000)

Goldman Sachs: $814 billion ($814,000,000,000)

Royal Bank of Scotland (UK): $541 billion ($541,000,000,000)

JP Morgan Chase: $391 billion ($391,000,000,000)

Deutsche Bank (Germany): $354 billion ($354,000,000,000)

UBS (Switzerland): $287 billion ($287,000,000,000)

Credit Suisse (Switzerland): $262 billion ($262,000,000,000)

Lehman Brothers: $183 billion ($183,000,000,000)

Bank of Scotland (United Kingdom): $181 billion ($181,000,000,000)

BNP Paribas (France): $175 billion ($175,000,000,000)

Federal Reserve's nearly 100 year history was posted on Senator Sander's webpage.

Mar. 06 2013 10:17 AM
Sheldon from Brooklyn

So, hyper-emotional Wall Street decided to huddle together and will themselves some fleeting mirage wealth. For most people it means nothing.

Mar. 06 2013 10:15 AM
RUCB_Alum from Central New Jersey matters but it does represent a transfer of wealth. If you had the means to leave your money in your mutual fund, you have been made whole. If you were close enough to actually needing to use that money, you took a bath. So net, it was a transfer of wealth from near-term retirees to those that were somewhat younger.
The major change in our economy has been the betrayal of the middle income earner by trickle-down economics. Rather than increasing with gains in productivity, wages have been tied to CPI...and thus the value of an hour of labor has fallen over the last 45 years.

Mar. 06 2013 10:07 AM
Robert from NYC

If you listen to your own news room and others you'd know that it doesn't matter for most of us but it does for people with money who invest in the market. Jobs are still low and so are salaries for the average worker.

Mar. 06 2013 10:07 AM

Simple. It means nothing. It bears no relation to the future income of firms & no hint of a need for further hiring.

The DJI bears no relation to our country's economic health. It's as insular as the pols in the DC bubble.

Mar. 06 2013 09:36 AM
JT from NJ

Does it matter? No.

Where are the jobs?

Mar. 06 2013 09:22 AM

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