Dow 10,000: A Sign of Things to Come?
Many people did not think we would see the Dow Jones Industrials—consisting of 30 bell-weather stocks—would reach 10,000 so fast. In March of this year, the Dow slipped to a multi-year low of about 6,500, a horrible and frightening drop from our all time high of 14,000 achieved in late 2007.
However, while many on Wall Street are celebrating the milestone, the majority of those on Main Street are still hurting. In recent weeks I have spoken to cab and limo drivers in Boston, New York and Washington (people who drive other people know everything about the economy). According to them business is still hurting and there are no signs of that turning around anytime soon. Also, unemployment is at a 26-year high, at over 10 percent. And the weekly jobless claims remained unchanged this week, with new workers filing for unemployment still topping the half a million mark (505,000).
Does that mean there is no hope? No, but at present we are getting mixed signals. Taken together, I think it means that a meaningful recovery that will help people of all stripes and industries is still months away at best. The stock market is a forward looking indicator. There is usually an eight to ten month lag between the stock market and what happens in the overall economy. In addition, corporate earnings have been pretty strong, with the majority of companies beating their quarterly expectations.
I am a glass-half-full kind of guy, and given the success of my relatively new publishing business (find it at http://jeffreykrames.com/), I have that luxury. I believe things will get better by the first or second quarter of 2010, but I do not believe that we will see a sharp reversal in the unemployment rate. Companies are adjusting, learning to do more with less. As a result, most companies are not rushing to hire people back. But expectations are so low that I expect stronger Christmas sales than most are prognosticating, and who knows…maybe that will carry so9me good cheer into the new year.
In any event, time will tell. But what the Dow is telling us is that some type of help is on the way. So while it is still really tough, hang in there. If you are without a job, widen your search to include the kind of jobs that at first blush you might not readily think of as being for you. Perhaps just getting out there in the workplace again might make all the difference in your outlook and your future prospects.