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Never said it was. The fact government may be priming the pump has little to do with the differences in stock valuation percentile increases among companies in the same industry.
It's also really pretty much irrelevant to the big picture argument and you know that which is why you have to boil the argument down to between two companies as opposed to the overall economy like is being discussed here.
Yes, one company can be better run than another, but that isn't what is being discussed.
Yes, but with less people employed means less consumers as well.
As pghquest pointed out, it is net loss to the economy in workers and subsequently consumers as well.
We have increased to 94 million Americans unemployed.
It's also really pretty much irrelevant to the big picture argument and you know that which is why you have to boil the argument down to between two companies as opposed to the overall economy like is being discussed here.
Yes, one company can be better run than another, but that isn't what is being discussed.
What is being discussed is the real economy and differences in stock market percentile increases among companies in the same industry tend to differentiate who is doing better or worse in the real economy.
pknopp, The F1000 earnings though, in aggregate, are at record highs, which means corporate profits overall are at record levels.
Instead of looking for doom and gloom that does not exist, enjoy this. It has been a long time coming.
I don't understand what you're arguing. Evidence shows that the share of investment to revenue is shrinking. Our point is that record corporate profits are a result of diminished capital investment in the real economy.
pghquest, Doing more with less should have happened decades ago. Less cost is a sustainable path to better earnings!
And the middle class is doing more, with less
Quote:
Originally Posted by bobtn
Since the last crash was hardly a natural thing, there is no reason to expect a repeat. This economy is fundamentally sound. Corps have healthy cash/other liquid reserves.
I know the OP finds that distressing!
While I agree we have an economic recovery taking place, the question I have is how is it "sound"? We have record numbers collecting welfare, middle class earning lower incomes, and while corporations are seeing record profits, the investment community overall is in the toilet. Bonds, cd, even treasury yields are horrible.
If you create crap markets in these other investment options, you cant be then surprised or act like people flooding the stock market overall is a sign of fantastic things taking place, especially given stocks climb sometimes while people lose their jobs..
The stock market, can actually counter the economy. This is the part many on the left want to ignore.
For example, look at the chart below which occurred during the great depression
This directly disproves any left wing theory that the economy is doing great, look at the stock market.
I do believe we are having some type of economic recovery, I also believe that it would have occurred a long time ago, and Obama policies delayed it, but..
The stock market is NOT an indicator of the economy, no matter how many times you guys want to believe it is.
Also? Yes, some companies after the crash figured out how to do more with fewer people to better withstand the next crash but that in no way disputes what I said.
Doing more, with less, would actually prove the economy isnt recovering, since these individuals dont have jobs and thus not able to contribute to the economy.
Since the last crash was hardly a natural thing, there is no reason to expect a repeat. This economy is fundamentally sound. Corps have healthy cash/other liquid reserves.
I know the OP finds that distressing!
I don't know if he finds it distressing, but I believe the question has been answered: low demand. If there are jobs and healthy earnings coming from this investment you speak about, then everyone will be happy. I don't see evidence of this. Middle-class earnings seem permanently stagnant while corporate earnings are at record levels. This is what would be expected in an unrestricted global economy, which is basically what we have. If it continues in this direction, parity will eventually be achieved between nations, and we actually will have billions of customers in China and SE Asia. The question is what do we have to go through to reach such a goal.
pghquest, There is demand, but we do not waste money, and very often we can spend far less replacing what needs replacing w/o buying brand new machinery. We wouldn't spend the money on it at all w/o demand for our products.
if you replaced your equipment, or even added to it, the overall age of your equipment would fall.
1 equipment 40 years old...
vs
1 equipment 40 years old
1 equipment 1 years old
average age 20.5 years...
Simply adding new equipment would drop the overall average age..
I just sold 10,000 shares of Apple. I'll take the profits and invest in the real economy.
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