Dow hits record, erasing Great Recession losses

Specialist Christian Sanfilippo, foreground right, works on the floor of the New York Stock Exchange Thursday, Feb. 28, 2013. Stocks turned mixed Thursday after two days of triple-digit rallies. Big-name companies reported higher quarterly earnings and the government said that the jobless claims are falling, but impending budget cuts cast a pall. (AP Photo/Richard Drew)

Specialist Christian Sanfilippo, foreground right, works on the floor of the New York Stock Exchange Thursday, Feb. 28, 2013. Stocks turned mixed Thursday after two days of triple-digit rallies. Big-name companies reported higher quarterly earnings and the government said that the jobless claims are falling, but impending budget cuts cast a pall. (AP Photo/Richard Drew)

— The stock market is back.

Five and a half years after the start of a frightening drop that erased $11 trillion from stock portfolios and made investors despair of ever getting their money back, the Dow Jones industrial average has regained all the losses suffered during the Great Recession and reached a new high. The blue-chip index rose 125.95 points Tuesday and closed at 14,253.77, topping the previous record of 14,164.53 on Oct. 9, 2007, by 89.24 points.

"It signals that things are getting back to normal," says Nicolas Colas, chief market strategist at BNY ConvergEx, a brokerage. "Unemployment is too high, economic growth too sluggish, but stocks are anticipating improvement."

The new record suggests that investors who did not panic and sell their stocks in the 2008-2009 financial crisis have fully recovered. Those who have reinvested dividends or added to their holdings have done even better. Since bottoming at 6,547.05 on March 9, 2009, the Dow has risen 7,706.72 points or 118 percent.

The Dow record does not include the impact of inflation. Adjusted for that, the Dow would have to reach 15,502 to match its old record.

The Standard and Poor's 500, a broader index, closed at 1,539.79, 25.36 points from its record.

The last time the Dow hit a record, George W. Bush still had another year as president, Apple had just sold its first iPhone, and Lehman Brothers was still in business.

But unemployment was also 4.7 percent versus 7.9 percent today, a reminder that stock gains have proved no elixir for the economy.

Still, the Dow high is another sign that the nation is slowly healing after the worst recession since the 1930s. It comes as car sales are at a five-year high, home prices are rising, and U.S. companies continue to report big profits.

The stock gains have helped retirement and brokerage accounts held by many Americans recover. That, in turn, has helped push U.S. household wealth nearly back to its peak before the recession, though many in the middle class are still deep in the hole. Most middle-class wealth is tied up in home values, which are still a third below their peak.

Good economic news Tuesday helped lift stocks. Retail sales in the 17 European countries that use the euro rose faster than expected, China's government said it would support ambitious growth targets, and a report showed U.S. service companies grew last month at their fastest pace in a year.

"It feels great," says Marty Leclerc, chief investment officer at Barrack Yard Advisors, an investment firm. In early 2009, when stocks were plummeting, "it looked like Armageddon was nigh. It's a lot more fun to be in a rising market."

In the depths of the recession four years ago, few investors would have predicted such a fast recovery. Some feared another Great Depression. Banks were collapsing, lending was frozen, world trade was plunging, and stocks were in free fall.

"People thought we were going to relive the 1930s," says Robert Buckland, chief global stock strategist at Citigroup. He calls the stock gains since "pretty remarkable."

From its peak in October 2007 to its bottom in March 2009, the Dow fell 54 percent. That was far less than the nearly 90 percent drop in the Great Depression but scary nonetheless. There had been 11 previous bear markets since World War II and none had reached 50 percent.

One man who stayed calm and didn't sell was Jay Sachs, 70, a retired computer consultant. In fact, as others scrambled to exit stocks in late 2008, he plunged in more — scooping up drug maker Ely Lilly and Co., health-care products giant Johnson & Johnson and food company General Mills.

"You have to be greedy when others are fearful," he says, quoting a famous line from billionaire Warren Buffett, who also bought in the panic. Sachs adds, "People are still fearful and that's a good sign. There's room for growth."

He says his portfolio has doubled in value in four years.

As stock rebounds go, this has been an unusually quiet and uncelebrated one. Typically, bull markets are accompanied by rising trading volume, a surge in young companies going public and Internet chatter over hot stocks.

The past four years, none of that has happened.

Adding to the chastened mood is lingering fear among many investors that stock gains can disappear in a flash. Burned by two stock-market crashes in less than a decade, Americans have sold more U.S. stocks than they've bought the past four years, nearly unprecedented in a bull market since World War II.

In this run-up, nearly all the buying has come from companies repurchasing their own stock in an effort to boost its value. Companies in the S&P 500 have bought $1.5 trillion since the Great Recession began in December 2007.

Dow records are dismissed by some investors as unimportant because the index comprises just 30 stocks. Many professional investors prefer to follow the S&P 500, which, as the name implies, tracks 500 companies. But the Dow has closely followed the ups and downs of its broader rival over the years, and is a good proxy for how big companies are doing.

The S&P 500 is up 128 percent from its March 9, 2009 low, about the same as the Dow.

The Dow record is a victory of sorts for Federal Reserve Chairman Ben Bernanke. Under his aegis, the Fed launched an unprecedented campaign to lift stocks by making their chief rival for investor money — bonds — less attractive.

Under a program called "quantitative easing," the Fed has bought trillions of dollars of bonds to drive their yields down. The idea was that the puny yields would so frustrate investors, they'd have no choice but to shift into stocks. That, in turn, would push up stocks and make people feel wealthier and more willing to spend, helping the economy.

Just as Bernanke had hoped, American household wealth, or assets minus liabilities, has risen, though the gains haven't been shared equally.

In the recession, household wealth fell $18.9 trillion, or 28 percent, as the prices of assets like stocks and homes tumbled. But after bottoming in the first quarter of 2009 at $48.5 trillion, wealth rose $16 trillion through the third quarter of last year and was within striking distance of its peak of $67.4 trillion, according to the latest data from the Federal Reserve. Gains since then may have pushed wealth to a new high.

Middle-class households have not recovered as much as those numbers suggest because most of their wealth is tied up in their homes, and home values haven't bounced back like 401(k) accounts.

Homes accounted for two-thirds of middle-class assets before the recession, estimates economist Edward Wolff of New York University. By contrast, they accounted for one-third of assets of all U.S. households. Stocks were 7 percent of middle-class assets, less than half the percentage for all.

The rich have been the biggest winners of this bull market. Eighty percent of all stocks are held by the wealthiest 10 percent of households.

The question now: Can the stock rally continue? Here are four reasons it could:

— Plenty of cash: Companies have enough money to keep buying shares, which can push stocks up in the short term. Companies in the S&P 500 had more than $1 trillion in cash late last year, two-thirds more than in 2007.

— Low inflation and interest rates: Two factors that typically spell the end of a bull market seem a long way off. Inflation has been 1.6 percent the past 12 months, below the Fed's 2 percent target. Interest rates are near record lows; the short-term rate the Fed controls is being kept between zero and 0.25 percent. The Fed has said it plans to keep the rate where it is until unemployment falls below 6.5 percent, or 1.4 points lower than it is today. Even when the Fed starts raising the rate, it could be years before it gets high enough to hurt the economy and stocks.

Four of the five previous bull markets since 1970 ended as investors got spooked by a recession, or the anticipation of one, and sold stocks. And what causes recessions? In three of the past five, it was the Federal Reserve hiking interest rates to slow inflation.

— Economic expansion: The economic expansion that began 44 months ago in June 2009 is still relatively young. The previous three expansions lasted 73, 120 and 92 months. And this one may finally be getting traction: Sales of new homes in January hit the highest rate in 4 ½ years. Home prices in January were up nearly 10 percent nationwide from a year earlier. And sales of autos, the second-biggest consumer purchase, reached a five-year high.

Most important, hiring is picking up. Employers added an average 200,000 jobs each month from November-January, compared with 150,000 in each of the prior three months. More jobs means more money for people to spend, and consumer spending drives 70 percent of economic activity.

— Stocks still seem reasonably priced based on the earnings that companies are generating. On average, stock prices are 17.5 times per-share earnings in 2012 versus 19.4 times in 2007. Today's price-earnings ratio is the same as the average since World War II.

If per-share earnings keep growing, stock prices could go up too, and the P/E ratio would stay the same. And there have been many periods in which the average P/E ratio rose well above the long-average. Such "multiple expansion," as market watchers refer to a rising P/E ratio, would mean stock prices would be even higher.

To stock bulls, the economy is on the verge of what Bernanke calls "escape velocity," a self-sustaining pace of growth and better than the sluggish 1-2.5 percent of the past three years. Faster economic growth would boost corporate earnings, which would lead to higher stock prices.

Of course, if investing was as simple as looking up interest rates and stock valuations, we'd all be rich. Plenty can go wrong.

For starters, future earnings, the biggest driver of stock prices, could prove disappointing. Financial analysts expect earnings for the S&P 500 to grow a healthy 8 percent this year, according to FactSet, a provider of financial data. Most of that increase is expected in the last half when they assume economic growth accelerates.

Will that happen? It's anyone's guess, and financial analysts are often too bullish. A year ago, they expected a 13 percent jump in earnings in the last three months of 2012. They got 4 percent instead.

Investors also need to pay attention to what's happening in the rest of the world. Big U.S. companies generate nearly half their revenue from overseas. The 17 European countries that use the euro as a currency have been in recession for more than a year. Japan, the world's third-largest economy, fell into one late last year. Stock markets tend to look ahead, so what matters is whether the recessions deepen in Europe and Japan or those economies start growing again.

Another worry is what will happen after the Federal Reserve stops stimulating the U.S. economy. Last month, minutes of the Fed's last policy meeting were released, and they showed members disagreeing on when to stop. The Dow lost 155 points in two days.

Jeff Sica, founder of money manager Sica Wealth Management, says the rising market is good because it's a sign of confidence. But he fears stocks could sink when the Fed stops buying bonds.

It's a big "psychological reason the market is going up," he says. "People know the Fed will continue to inflate assets."

The Fed stimulus was in response to the worst economic recession since the 1930s.

The Great Recession began in December 2007, two months after the Dow and S&P 500 reached their peaks in October. It was triggered by a drop in home prices that hammered consumers and banks. Nine months later, in September 2008, Lehman Brothers declared bankruptcy and lending froze worldwide.

Panicked investors began pulling money out of stocks. Prices, which had been falling slowly, nosedived. By March 9, 2009, the Dow had fallen 54 percent and the S&P 500 57 percent.

In total, $11 trillion in stock wealth, or 12 years of stock gains, were wiped out in 17 months.

Despite widespread fear then, the history of bear markets was encouraging. In the second- and third-worst bear markets since World War II, the S&P 500 fell 49 percent in 2000-02 and 48 percent in 1973-74. Both times the climb back took less than six years.

But few people believed four years ago that the return would be so fast.

A few days after stocks bottomed, a BusinessWeek cover story laid out three scenarios for regaining the losses. The most pessimistic held that stocks would notch 6 percent gains each year and the Dow would return to its old high in 2022, 13 years later. The most optimistic assumed 10 percent annual gains and saw a return in 2017, eight years later. The Dow has rebounded in about half the time as the most optimistic case.

The climb hasn't been smooth, though.

In May 2010, a trading glitch set off a so-called flash crash that sent the Dow plunging 600 points in five minutes. In August 2011, stocks yo-yoed for several days on fears that the U.S. would default on its debt. Over three weeks, the Dow plunged 2,000 points. Last October, the Dow fell 1,000 points over six weeks on worries that a budget deal wouldn't get passed and the economy would go over the "fiscal cliff."

But the Fed's bond buying and the ability of companies to produce record profits helped the market overcome every setback.

In the turbulent journey to new highs, Wall Street strategists and other experts have predicted many times that small investors were about to fall in love again with stocks. The "dry powder" of their money would set fire to an already hot market. After all, small investors had helped push stocks up in the great bull market of the '80s, which began in August 1982. Those who had left the market years earlier began buying again, and stocks more than tripled in five years.

They drove a bull market again in the 1990s. Stocks more than quintupled in 9 ½ years.

But small investors have not only stayed away the past four years, they have sold hundreds of billions of dollars of stocks.

Then, in January, as the Dow inched closer to its record, individual investors seemed to have second thoughts. They put nearly $20 billion more into U.S. stock mutual funds than they took out in January, according to the Investment Company Institute, a trade group for funds.

It was just a trickle, but it may have helped stocks surge. In January, the Dow rose 5.8 percent, and the S&P 500 rose 5 percent. It was the best start to a year for the Dow since 1994.

For good or ill, it's possible the Dow's new high might convince investors to put more money into stocks.

"When you hear about new highs, the greed factor kicks in," says Colas, the BNY ConvergEx strategist. "It gets people to think, 'Do I own enough stocks?'"

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Comments » 68

SeeFuture writes:

I recall dumbo Republicans telling us Obama was going to kill the markets. What happened? Duh...

theabyss writes:

The Government is pumping BILLIONS into the market without your knowledge, fear not, it will take a dive, big time!

WeThePeople2016 writes:

This is just part of the larger picture which will DEMOLISH the Republican Party--and the rigid positions led by Boehner that "we are done with revenue". So let's imagine those just at the $500,000 income level who, in Dec. 2012, were spared from the return to the LEGITIMATE INCOME TAX RATES of pre-Bush. This was negotiated in the Fiscal Cliff bill.

Now, they are also making millions more in their stock market investments, while the greedy and thoughtless whine on about the government spending "other people's money" and the negative impacts of raising the minimum wage "gradually" over the next few years.

Even some conservative commentators on Fox occasionally have something positive to say about the developments, and don't care about credit or blame. But not the obnoxious "Fellowship of the Miserable" who post here. How much of all this "BAD" news can they endure???

WeThePeople2016 writes:

And just "look at the scoreboard" as we state our case on the "CENTRIST" majority position...no spin, just facts.

U.S. Budget Deficit Narrows in 2012
==================================
January 17, 2013
WASHINGTON - U.S. builders started work on homes in December at the FASTEST PACE since the summer of 2008 and finished 2012 as the best year for residential construction since the early stages of the housing crisis.
===============================
Dec. 2012 REP. Gerry Connolly claims stock market doubled under Obama
===================================
New powerboat sales increased 10 percent nationwide in 2012. The increase is the first time since the boating industry experienced significant growth IN FIVE YEARS, said Thom Dammrich, president of the National Marine Manufacturers Association.
=============================
"Almost every aspect of the industry saw growth," Dammrich said. "CONSUMER CONFIDENCE today is higher than it was a year ago, and we have an improving economy.
==========================
Unemployment rates FALLS AGAIN in Collier and Lee counties

In Collier, unemployment dropped to 7.3 percent in December, down from 7.8 percent in November. .
A year ago (WHICH WAS ALSO IN SEASON), Collier's rate stood at 9 percent.
------------------------------------
Florida labor officials said Friday that the STATE's unemployment rate dipped....
Florida unemployment now stands at its LOWEST LEVEL since it was at 7.8 percent in November 2008.
======================================

In the keynote address at the Republican National Committee's winter meeting, Jindal said the GOP doesn't need to change its values but "might need to change just about EVERYTHING ELSE we are doing."..."We've got to STOP BEING THE s----- PARTY. It's time for a new Republican Party that talks like ADULTS
=================================
• NABOR: Home prices in Naples area increased 17 percent in 2012
• NABOR: Home sale prices up 14 percent in November over a year ago
• NABOR: October home and condo prices up 20 percent over a year ago
• NABOR: Pending home sales up 12 percent in third quarter

===================================

Mar. 2, 2013--- Home price increase BEST IN SEVEN YEARS
=============================

Mar. 5, 2013----US STOCKS-Dow sets RECORD HIGH as rally continues
================================

I'm running out of space to post POSITIVE developments

Only the House Republicans have the power to try and prevent continued improvement as they pursue their own SELFISH agenda--PARTY, not country is their obvious priority

WeThePeople2016 writes:

in response to theabyss:

The Government is pumping BILLIONS into the market without your knowledge, fear not, it will take a dive, big time!

Are you familiar with the story of chicken little?? Oh, you must have liked that one. Will you also post a denial of ALL of the positive economic developments posted above?? Can you document the "Government pumping BILLIONS" claim for us????

Sorry if all the good news ruins your day---was not my intention.

theabyss writes:

Magic, I am in the top 1%... I really don't care but am just commenting. If you know it all and how it works maybe you should join our percentile...

WeThePeople2016 writes:

in response to TroutNoDoubt:

(This comment was removed by the site staff.)

So when it goes down--it is a cyclical thing--it will be because of events in Europe wit no blame to the President--and is the DOUBLING since Jan.2009 due to events from China as well??

Coastal writes:

I got to hand it to all you Obama deciples, this market looks like there is no end in sight. My advice to you is to put any money you have into it. In fact, you should probably borrow what ever you can and put it into this remarkable Obama market.

cozyboy writes:

The sequester is working, keep cutting and keep printing money Wee haw

mjohn2659 writes:

The market is increasing under an artificial bubble. It is exactly like the housing market. The deficit, unemployment rate, inflation, printing money, and the like is creating a false increase.

WeThePeople2016 writes:

in response to Coastal:

I got to hand it to all you Obama deciples, this market looks like there is no end in sight. My advice to you is to put any money you have into it. In fact, you should probably borrow what ever you can and put it into this remarkable Obama market.

....as opposed to the wealthiest who put their Bush tax cut money into the stocks during the past 4-5 years and now can take their profits--earned with "other people's money"--and help create a drop in the Dow--all the while railing against President Obama--and screaming against returning to the pre Bush tax rates as was in the deal to lower the rates in the first place

Definition: HYPOCRITE-- - a person who professes beliefs and opinions that he or she does not hold in order to conceal his or her real feelings or motives

Definition: Greedy---Excessively desirous of acquiring or possessing, especially wishing to possess more than what one needs or deserve

DinNaples writes:

It's funny, these same idiotic Obots would remind us that when the market was down it was not a indicator of what our economy was doing. That is even more true now. Money pouring into the stock market has little effect at this time to the economy.

WeThePeople2016 writes:

in response to mjohn2659:

The market is increasing under an artificial bubble. It is exactly like the housing market. The deficit, unemployment rate, inflation, printing money, and the like is creating a false increase.

False analogies reveal a desperate soul--were all of the POSITIVE economic gains that I list above--and will continue to because many don't seem to know of, or acknowledge the existence of developments that WERE NOT present during the housing bubble. Given that housing bubble experience, do you really think that fund managers and wealthy investors would be involved in reckless stock purchases??

Quietcat writes:

"Keep Obama in President!"

amuser writes:

You go Obama! This would not be happening under Republican leadership.

upagain writes:

Easy money always inflates assets. Housing was the last stop... Good job FED.

upagain writes:

Dual mandate for the FED is inflation... Assets included, not just goods and services.

cozyboy writes:

in response to amuser:

You go Obama! This would not be happening under Republican leadership.

But he hates those fat cat wall streeters. They dont pay their fair share.

WeThePeople2016 writes:

in response to DinNaples:

It's funny, these same idiotic Obots would remind us that when the market was down it was not a indicator of what our economy was doing. That is even more true now. Money pouring into the stock market has little effect at this time to the economy.

Au Contraire---I would definitely say that the stock market lows from 2006-2009 in particular were a DEFINITE indicator of how the economy was doing---and I don't have to research anything to know it and feel it---

You ought to think about what you're posting--maybe you have no real life experience OR facts to relate to your pointless denials. How "idiotic" to argue against fact after fact with nothing more than name calling, etc.--Gov. from La. want the Republicans to become an ADULT party --take heed.

tried_n_true writes:

Obama is the worst socialist ever !

Coastal writes:

in response to WeThePeople2016:

....as opposed to the wealthiest who put their Bush tax cut money into the stocks during the past 4-5 years and now can take their profits--earned with "other people's money"--and help create a drop in the Dow--all the while railing against President Obama--and screaming against returning to the pre Bush tax rates as was in the deal to lower the rates in the first place

Definition: HYPOCRITE-- - a person who professes beliefs and opinions that he or she does not hold in order to conceal his or her real feelings or motives

Definition: Greedy---Excessively desirous of acquiring or possessing, especially wishing to possess more than what one needs or deserve

No, not at all, I agree with you. It's much better to print money to put into the market rather than the outdated free market. All those "rich" people with their fancy 401Ks who put their money in the market all they did was invest in businesses, how riskey is that, right? After all, there is no limit to how high the market can go when the gubmint is printing the money. You are missing the boat if you don't put your money in this market. I say jump on it.

badgerfan writes:

in response to theabyss:

Magic, I am in the top 1%... I really don't care but am just commenting. If you know it all and how it works maybe you should join our percentile...

If you don't care then why make the s----- derogatory statements.....IF you are the 1% then lead by positive energy not such a backward negative thinking! You must have inherited your 1%...

gl1800 writes:

in response to SeeFuture:

I recall dumbo Republicans telling us Obama was going to kill the markets. What happened? Duh...

A light bulb burns the brightest before it goes out.

Exposer writes:

in response to theabyss:

The Government is pumping BILLIONS into the market without your knowledge, fear not, it will take a dive, big time!

If there weren't BEARS like you, we wouldn't have the market we are enjoying. Keep fighting the tape and feed those shorts. What's another margin call, right?

Exposer writes:

in response to gl1800:

A light bulb burns the brightest before it goes out.

Now that's the best description of the Romney run for president I've heard. Good one.

mjohn2659 writes:

in response to WeThePeople2016:

False analogies reveal a desperate soul--were all of the POSITIVE economic gains that I list above--and will continue to because many don't seem to know of, or acknowledge the existence of developments that WERE NOT present during the housing bubble. Given that housing bubble experience, do you really think that fund managers and wealthy investors would be involved in reckless stock purchases??

All i can say is don't be desperate then! You're comments was how Naples was doing! Get real dummy.. BTW It cost 'only' 6 trillion to get the stock market where it was... But i bet you think that's a bargain? LMAO

SPEAKFORGOD writes:

in response to theabyss:

Magic, I am in the top 1%... I really don't care but am just commenting. If you know it all and how it works maybe you should join our percentile...

Top 1% of what????????? Thanks for the laugh...........

ex31539er writes:

Wasn't Obama (not to mention the Naples Daily News with its endless "The Sky is Falling! The Sky is Falling" reportage) just saying Republicans' refusal to raise taxes to bale Obama out of his Sequester fiasco was going to tank the economy?

It seems the market is, instead, more than a little pleased the government beast is being chastened, even by a little bit.

Chester writes:

Ben Bernanke (Fed Chairman) is pumping billions of dollars into the economy thus keeping interest rates super low, so there is no profit value in bonds, CD's etc.. So, then all the big money is going into stocks. That is why the market is exploding. The key is when will this fed pumping end?

Chester writes:

in response to Exposer:

If there weren't BEARS like you, we wouldn't have the market we are enjoying. Keep fighting the tape and feed those shorts. What's another margin call, right?

The poster is correct that the the billions the fed is printing is causing all the big money going into the stock market because there is low value in buying bonds when interest rates are 1%. I just hope when the fed cools his heels the market won't nose dive. That is the truth, politics aside! I don't want the market to tank anymore than you do, no matter who is Prez!

lionfishhunter writes:

in response to Chester:

The poster is correct that the the billions the fed is printing is causing all the big money going into the stock market because there is low value in buying bonds when interest rates are 1%. I just hope when the fed cools his heels the market won't nose dive. That is the truth, politics aside! I don't want the market to tank anymore than you do, no matter who is Prez!

I expressed to my portfolio manager my concerns about the fed pumping money into the economy and the possible effects to the economy. He said that the smart money doesn't fight the Fed. He's kept me 80% in stocks and all is well. My buddy who has been hedging against the market may have to come out of retirement and go back to work. My wanting to get out of the market was due to my 50% viewing of Fox news. I'm just trying to be fair and balanced.

DinNaples writes:

in response to WeThePeople2016:

Au Contraire---I would definitely say that the stock market lows from 2006-2009 in particular were a DEFINITE indicator of how the economy was doing---and I don't have to research anything to know it and feel it---

You ought to think about what you're posting--maybe you have no real life experience OR facts to relate to your pointless denials. How "idiotic" to argue against fact after fact with nothing more than name calling, etc.--Gov. from La. want the Republicans to become an ADULT party --take heed.

So I guess you've been quite successful and are financial independant ? You certainly imply you know more than many of us. Care to share your successes?

erock writes:

So far this has been a very useful commentary. The equity positions are now sold. Time to wait for either the correction or the crash. Wish I could pick the peak, but I know from experience I can't do it. Good luck, everyone.

WeThePeople2016 writes:

Ask your Republican friends--if you have any

I'm just reporting the facts ---got a better theory?? Or you can simply continue to ignore the facts and keep hoping for something bad to happen in the economy--clearly, that would a boost for you in your little world of negativity.

WeThePeople2016 writes:

in response to mjohn2659:

All i can say is don't be desperate then! You're comments was how Naples was doing! Get real dummy.. BTW It cost 'only' 6 trillion to get the stock market where it was... But i bet you think that's a bargain? LMAO

Keep laughing--the world loves a clown

WeThePeople2016 writes:

in response to theabyss:

Magic, I am in the top 1%... I really don't care but am just commenting. If you know it all and how it works maybe you should join our percentile...

Right--like a real 1% would spend time posting here--why are people so mad at this development??--My sources report that the profit margins are higher than expected--not surprising given the pay scales--irregardless--why not just enjoy a little "irrational exuberance"?? --Never mind--I know the real reason why.

Your seem to be falling deeper into the abyss

WeThePeople2016 writes:

in response to Coastal:

No, not at all, I agree with you. It's much better to print money to put into the market rather than the outdated free market. All those "rich" people with their fancy 401Ks who put their money in the market all they did was invest in businesses, how riskey is that, right? After all, there is no limit to how high the market can go when the gubmint is printing the money. You are missing the boat if you don't put your money in this market. I say jump on it.

“This is about the strangest market environment I’ve ever seen,” says Donald Luskin, chief investment officer at Trend Macrolytics."

Now tell me how you will respond to this source?? More wise cracks??

Need more??

"There are some strong forces propelling the market’s rally. Over the long term, stock prices tend to reflect corporate earnings. While S&P 500 per-share profits may decline 1.8 percent this quarter, they will rebound 11 percent in the final three months of the year, 11 percent next year, and 12 percent in 2014, according to analysts’ estimates compiled by Bloomberg, reaching RECORD LEVELS with every gain."

mjohn2659 writes:

in response to WeThePeople2016:

Keep laughing--the world loves a clown

You're the one with a big red nose, big mouth, and i bet you wear boat shoes... So your job is very safe..Btw you have know FACTS! You have "claims" Son. Sure Fla, is doing good but it wasn't NOTHING Obama did...Go peak around in his home town Chicago, and up North were the "D'' is strong and the economy is weak. Your Magic is weak son..LMAO

BillyBob1 writes:

in response to SeeFuture:

I recall dumbo Republicans telling us Obama was going to kill the markets. What happened? Duh...

Well Homer I guess you are trying to get someone to read this article to you? The author pretty much explains it here. The short story is, the Federal Reserve has made interest rates just about zero for a long time. The market will coninue to improve for "too big to fail" companies so long as the Federal Reserve continues to buy the caustic assets and junk bonds they generate.

BillyBob1 writes:

in response to WeThePeople2016:

False analogies reveal a desperate soul--were all of the POSITIVE economic gains that I list above--and will continue to because many don't seem to know of, or acknowledge the existence of developments that WERE NOT present during the housing bubble. Given that housing bubble experience, do you really think that fund managers and wealthy investors would be involved in reckless stock purchases??

Obviously you must have just arrived here on this planet. The answer to your question is YES. Investors buy reckless stocks, the more wealthy they are and the bigger the company is the less they worry about risk. Too big to fail has become the only insurance one needs.

mjohn2659 writes:

When Obama took office there were 28 million on food stamps, now they are 47 million and rising! Work your Magic with that Mr Magic.........You must be one of them.

Captian_Cataracts writes:

in response to WeThePeople2016:

And just "look at the scoreboard" as we state our case on the "CENTRIST" majority position...no spin, just facts.

U.S. Budget Deficit Narrows in 2012
==================================
January 17, 2013
WASHINGTON - U.S. builders started work on homes in December at the FASTEST PACE since the summer of 2008 and finished 2012 as the best year for residential construction since the early stages of the housing crisis.
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Dec. 2012 REP. Gerry Connolly claims stock market doubled under Obama
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New powerboat sales increased 10 percent nationwide in 2012. The increase is the first time since the boating industry experienced significant growth IN FIVE YEARS, said Thom Dammrich, president of the National Marine Manufacturers Association.
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"Almost every aspect of the industry saw growth," Dammrich said. "CONSUMER CONFIDENCE today is higher than it was a year ago, and we have an improving economy.
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Unemployment rates FALLS AGAIN in Collier and Lee counties

In Collier, unemployment dropped to 7.3 percent in December, down from 7.8 percent in November. .
A year ago (WHICH WAS ALSO IN SEASON), Collier's rate stood at 9 percent.
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Florida labor officials said Friday that the STATE's unemployment rate dipped....
Florida unemployment now stands at its LOWEST LEVEL since it was at 7.8 percent in November 2008.
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In the keynote address at the Republican National Committee's winter meeting, Jindal said the GOP doesn't need to change its values but "might need to change just about EVERYTHING ELSE we are doing."..."We've got to STOP BEING THE s----- PARTY. It's time for a new Republican Party that talks like ADULTS
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• NABOR: Home prices in Naples area increased 17 percent in 2012
• NABOR: Home sale prices up 14 percent in November over a year ago
• NABOR: October home and condo prices up 20 percent over a year ago
• NABOR: Pending home sales up 12 percent in third quarter

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Mar. 2, 2013--- Home price increase BEST IN SEVEN YEARS
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Mar. 5, 2013----US STOCKS-Dow sets RECORD HIGH as rally continues
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I'm running out of space to post POSITIVE developments

Only the House Republicans have the power to try and prevent continued improvement as they pursue their own SELFISH agenda--PARTY, not country is their obvious priority

(This comment was removed by the site staff.)

pmz writes:

The problem that republicans have with today is it is such a reminder of their failure. For five, long years they have done everything possible to destroy the American economy in order to make their efforts under Bush better than worst in history. They have totally failed.

Thank God, a President came along that has out flanked them at every turn.

Their failure is what fueled our success.

Think of where we'd be now if they had succeeded.

John_Galt writes:

in response to pmz:

The problem that republicans have with today is it is such a reminder of their failure. For five, long years they have done everything possible to destroy the American economy in order to make their efforts under Bush better than worst in history. They have totally failed.

Thank God, a President came along that has out flanked them at every turn.

Their failure is what fueled our success.

Think of where we'd be now if they had succeeded.

You missed the part where, when adjusted for inflation, the market would have to reach 15,500. And that's when using the government's politician-tweaked number for inflation. They take out all of the important things, like Oil, Groceries, etc. You know - the things that should really make up the inflation number. Real inflation is not 1.5%, rather it is around 20%, and it's only going to get worse. Since the great recession, the money supply has increased by over 200%! Do you know what the definition of inflation is? It's not the general rising of prices!

Inflation: The increase in the supply of money.

As the money supply increases, the general cost of everything goes up. It may take a while, but it will happen. Get ready for 200% inflation to meet up with the 200% increase in the money supply.

Davidh239 writes:

Took a little off of the table today. I had some high flyers that were paying more dividends than the EPS could support.

Even if we have a pull back, good companies are still the same as they were 2,5 and 10 years ago.

Good market for trading, not so much for long term. IMO

WeThePeople2016 writes:

in response to iwantastiffdrink:

(This comment was removed by the site staff.)

Give me one indication where I indicated that it will "stick around for as far as the eye can see".

You make things up to fit your skewed views. I'm just enjoying a little "irrationa; exuberance" perhaps, but I surely trust

-- what the stock brokers in today's paper said and
-- all of the research that I did about higher business profits that expected, etc,
--and even the role of the Fed--

MUCH more than I would put any stock in your endless stream of negativity.

Is there a SINGLE aspect of the improving economy since 2009 that you would acknowledge?? Didn't think so.

WeThePeople2016 writes:

in response to John_Galt:

You missed the part where, when adjusted for inflation, the market would have to reach 15,500. And that's when using the government's politician-tweaked number for inflation. They take out all of the important things, like Oil, Groceries, etc. You know - the things that should really make up the inflation number. Real inflation is not 1.5%, rather it is around 20%, and it's only going to get worse. Since the great recession, the money supply has increased by over 200%! Do you know what the definition of inflation is? It's not the general rising of prices!

Inflation: The increase in the supply of money.

As the money supply increases, the general cost of everything goes up. It may take a while, but it will happen. Get ready for 200% inflation to meet up with the 200% increase in the money supply.

Inflation is at 20%???? How laughable. In your unique methods, do you factor in all the "Sale" prices?? or just the pre-sale prices? How about all the "2 for 1's"--You do buy a few at the grocery store do you not?? do you factor in the prices BEFORE multiple coupons are used?? or only the pre-coupon prices??

You're trying to make this sound like the German cuurency inflation role under the Weimar Republic. If you are CLOSE to correct, I wonder if there is enough gold in the world for the wealthiest to put their money in.

It sure feel like a deflationary economy to me over the past several years.

WeThePeople2016 writes:

in response to mjohn2659:

When Obama took office there were 28 million on food stamps, now they are 47 million and rising! Work your Magic with that Mr Magic.........You must be one of them.

Thank you for providing the statistical proof of what I have been trying to point out--the disappearing Middle Class as we head towards a 2 class society--rich and poor. Your way of presenting the statistic is proof of lack of understanding of the big picture in my opinion.

And how many of those recipients are working--do you have that figure for us too?? I mean, without having to look it up??

WeThePeople2016 writes:

in response to DinNaples:

So I guess you've been quite successful and are financial independant ? You certainly imply you know more than many of us. Care to share your successes?

It's not just me--a clear majority of the country seems to know more than you at least as seen in election results and polls. But you seem to hold to the position that you know more than the majority.

felipe writes:

in response to tried_n_true:

Obama is the worst socialist ever !

you have no clue what the word means but i notice you use it as much as your DEPENDS , DAILY !!!! move on already , nobody is listening !!!!

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