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In the broader market “multiple expansion is driving stock market performance to a far greater degree than earnings while earnings themselves are being driven to a remarkable extent by share buybacks,”
Well, sales growth has been slow, no doubt about it, but it's STILL GROWTH (latest S&P sales growth numbers - from 2nd quarter - are a bit over 3%) - and (as I've said before) with the UE rate finally down to more normal levels, competition for workers should pick up now - which will drive wage increases for workers and (if history is any example) thereafter, sales growth.
BTW - I should point out that the articles' author was dead wrong in his prediction of the stock market performance in December. That article was published a bit less than a year ago (on Nov 30, 2013) and the author predicted "profit taking" for "the rest of December". As it turned out, December was an "up", with the S&P ending the month around record highs. So much for his prognostication skills.
Ken
Last edited by LordBalfor; 11-09-2014 at 08:57 AM..
Well, sales growth has been slow, no doubt about it, but it's STILL GROWTH (latest S&P sales growth numbers - from 2nd quarter - are a bit over 3%) - and (as I've said before) with the UE rate finally down to more normal levels, competition for workers should pick up now - which will drive wage increases for workers and (if history is any example) thereafter, sales growth.
Ken
And several other very key factors, including the declining price of oil and the increased value of the USD. 2 biggies right now and at the right time to help light our economic fire.
And several other very key factors, including the declining price of oil and the increased value of the USD. 2 biggies right now and at the right time to help light our economic fire.
Yup.
I think this year will definitely build on the recovery of the last few years - and excellorate it to a more impressive rate (this is particularly true regarding wages - finally).
The downside for companies and consumers will be that we will probably start to see a bit more general inflation (though the lower energy costs MIGHT keep it check - it's a tough call). So, far only food has really seen any real inflation - and that's pretty much all weather-related rather than systemic. When wages rise though, general inflation usually picks up - as companies tend to try and pass on those higher labor costs to the consumer.
I haven't read all 90 some pages but I've been reading the last 5-10.
To add to what others have said, we have been undergoing a shift in labor. Businesses simply don't need as many people to work anymore through globalization and automation. The rise of AI will be interesting the next few decades. Businesses are more productive than ever because they can do more with less. It's a big reason why we having this jobless recovery.
I haven't read all 90 some pages but I've been reading the last 5-10.
To add to what others have said, we have been undergoing a shift in labor. Businesses simply don't need as many people to work anymore through globalization and automation. The rise of AI will be interesting the next few decades. Businesses are more productive than ever because they can do more with less. It's a big reason why we having this jobless recovery.
Essentially correct - and this was not the first recovery to have to deal with that situation. The recovery after the last recession (2001) was sub-par in regards to job creation as well - and for the very same reasons (foreign labor competition and automation). It was indeed THAT "recovery" where the term "jobless recovery" was coined).
It has nothing to do with who is President or which party is in power. Instead it has everything to do with foreign labor and advances in technology.
Ken
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