DJIA 10,000

[Chris Santee]

It may not hold on to close there, but

on October 14th, 2009, the Dow Jones Industrial Average broke 10,000.

That is good economic news.

[Henry]

Was just down at The Town Office - Things were hopping - Things are looking up.

[Rev. Elizabeth]

That may seem like good news, but I don't believe the DJA reflect the actual state of the economy. Jobs are still being lost; the unemployment rate is higher than it has been in many years, and those filing for unemployment have increased.  Some states are extending unemployment benefits.

[Henry]

I am not too smart when it comes to this type of stuff.  I get a pension, but it was all provided for me by IBM with no financial planning on my part then or now.  With the DJIA going up like this, doesn't this effect the 401k accounts of the people.  I know my kids have mentioned how much money they have lost for their retirement.

[j_gluck]

Here are some articles with information.

From Bloomberg - U.S. Foreclosure Filings Jump 23% to Record in Third Quarter
http://www.bloomberg.com/apps/news?pid=20601103&sid=aFofq9_za8Is

"A total of 937,840 homes received a default or auction notice or were repossessed by banks, a 23 percent increase from a year earlier, the Irvine, California-based seller of default data said today in a report. One out of every 136 U.S. households received a filing, the highest quarterly rate in records dating to January 2005."

According to my calculations that one foreclosure every 8.36 seconds in the last quarter.

"The delinquency rate for prime loans rose to 6.41 percent in the second quarter from 6.06 percent, the Washington-based Mortgage Bankers Association said Aug. 20. The share of prime loans in foreclosure increased to 3 percent from 2.49 percent, the MBA said.

“The number of people who can’t pay their mortgages, we haven’t seen the peak of that,” David Lowman, head of JPMorgan Chase & Co.’s mortgage unit, said this week. “That’s going to weigh on us for some time to come.” "

What this means is that banks are choosing not to foreclose on a lot of properties to avoid losses, so their balance sheets look better - listen to today's Democracy Now! with an interview with former bank regulator William Black, author of The Best Way to Rob a Bank Is to Own One.
http://www.democracynow.org/2009/10/15/black

Here's another one from the AP

MBA: Foreclosures, unemployment to peak next year
http://www.google.com/hostednews/ap/article/ALeqM5hNuKYzt2nf63APCqeHdmYPod8sQAD9BAHJ501

Foreclosures will peak by the end of next year and unemployment will climb above 10 percent as the housing market and U.S. economy grapple with the aftermath of the recession, the Mortgage Bankers Association's chief economist said Tuesday.

Jay Brinkmann's forecast, released at the trade association's annual convention and expo in San Diego, envisions a slowly growing economy and improving housing market, with home price declines abating and fixed mortgage interest rates remaining below 6 percent.

We can pretend all we want that things are getting better, or back to normal, but for most of the country they're not.

[j_gluck]

Insights from former Labor Secretary Robert Reich

 Why the Dow Broke 10,000, and Why You Should Still Watch Your Wallet
http://robertreich.blogspot.com/2009/10/why-dow-broke-10000-and-why-you-should.html

How did the Dow break 10,000 when the rest of the economy is in the toilet?

1. Corporate earnings are up -- mainly because companies have been cutting costs. Payrolls comprise 70 percent of most companies' costs, which means companies have been slashing jobs. In the end, this is a self-defeating strategy. If workers don't have jobs or are afraid of losing them, they won't buy, and company profits will disappear.

2. Federal borrowing has filled the gap that consumers and businesses created when the latter began to reduce their debt. Federal debt, in other words, has kept the economy from tanking. Can't keep up forever, though.

3. With such horrid employment numbers, Wall Street figures the Fed will keep interest rates low for some time, and continue to flood the economy with money. That's good news for the Street because it means money stays cheap -- and with cheap money the Street can make lots of bets on almost everything under the sun and moon. As a result, the Street's earnings are way up. But this, too, is temporary. At some point the Fed is going to worry about inflation and a falling dollar.

4. Investors of all stripes want to get in early and ride the wave. Pension funds, mutual funds, and other institutional investors figure the bull market has more oomph in it because, well, other investors will jump in. Think Ponzi scheme. Nice for now, but watch out if you're one of the last in.

In other words, this is all temporary fluff, folks. Anyone who hasn't learned by now that there's almost no relationship between the Dow and the real economy deserves to lose his or her shirt in the Wall Street casino.

[DrewCrash]

my messages have been deleted by myself. I didn't want anyone thinking Henry did it. I elected to do it on my own because I don't need to be getting so frustrated. I will stick to local discussion from here on out...

[Henry]

Thanks for letting me know you deleted them yourself DrewCrash - I screen every new member very close and to the best of my knowledge only the originator or administrator can delete or modify their post.  Had a situation yesterday where a member's account got deleted, but I didn't do it - Finally was able to contact the individual and they told me that somehow they screwed up themselves.

Whenever I delete a post and that is quite rare, I hopefully notify the individual that posted it.

I believe the modify or delete for an originator is available to everyone.  If anyone has a problem doing it, let me know and I will go in and check your account permissions.

[mirjo]

I don't have a head for numbers, but I do understand that the media does not report for the working class. We always hear about the "Middle Class." I think there is a very wide spread of "middle class," I don't know where MC ends and WC begins, but I think they're the same. The backbone of this country are the folks that make it run, those IBMers etc.

When you hear media reports on the economy in my view they're directed at people who don't have the same concerns as average folks. I would bet my meager bank account there isn't a single person in this state that needs to be told that you can save money by

packing your lunch instead of eating out

making coffee at home instead of buying $3 lattes

This is common sense stuff and likely common practice for most. So it's no surprise the fact that stock market being up is seen as recovery even when people are still not doing well. The stock market is thought of as the end all be all, but not everyone owns stock or a lot of stock. it's easy to forget the bottom of the pile, because its on the bottom.


Th

[David Shea]

Following suit with Drew Cash, my post in this thread have been removed as well.  I look forward to meeting you sometime to discuss issues over coffee.

Dave

[DrewCrash]

I am always around for a lively discussion...

[Mike Raburn]

NOW NOW NOW...

I would be the person who would  get edited or deleted by THE MODERATOR of this here forum, PULEEZZ!!!

I would lay into the current Noble Peace Price recipient but it isn't worth my time, nor yours.

At LEAST Jimmy Carter did something. Egypt and Israel.

[Formerflatlander]

Mike, I think the Peace Prize Committee is taking a page from the wunderkids on Wall St. and hedging their prize to futures of peace earnings by the President.  That or they are taking pity on how badly he was dissed by the IOC's denial of Chicago for the 2016 Olympics.

[mirjo]

It's really just the American way to hate the president and politicians in general isn't it? But that's what makes this country what it is, we have the liberty to be that way w/o fear. It is great.

[7F24]

"how badly he was dissed by the IOC's denial of Chicago for the 2016 Olympics."

If anyone was "dissed" I'd say it was the United States, not the President.  We tend to be quite selfish, I really don't think we are being "dissed" if we don't get what we want.