May 16, 2024
All they care about is having something solid to point to to claim Bidenomics worked. That it is smoke-and-mirrors is imamterial to them.
BTW inflation hurts bonds and savings so stocks naturally rise during an inflationary period. Duh.
John F. DiLeo
The left is excited and happy. The Dow just went over 40,000, so they think that means we're not in a recession.
Don't tell them that the Dow is denominated in US Dollars, which means inflation applies to it too. A climb in the Dow is only good to the extent that the climb is superior to the rate of inflation.
So for example if the Dow goes up by 10% but the real inflation rate is 2%, then that means the business sector is probably doing well.
But if the Dow goes up by 10% and the real inflation rate is over 10%, then that means the business sector is just treading water, like everybody else.;
Nothing happens in a vacuum. You have to look at economic numbers in context.
Let's say an individual stock (that has not split or otherwise changed what it represents) was trading at $100 three years ago, but it's trading at $120 today. That sounds like it's worth 20% more after three years. But since inflation was running over ten percent per year all three of those years, the stock has not kept up with inflation, so the stock is actually worth less.
The $100 stock price in 2021 represented a hundred 2021 dollars, while the $120 stock price today represents a hundred and twenty 2024 dollars. And 2024 dollars are worth much less than 2021 dollars were.
All economics must be viewed in context.
Tim adds:
If anything this is proof we have a top-down economy where the wealthiest are profiting handsomely and the working class suffers. A good stock market disproportionately benefits the rich and Biden knows it. High inflation disproportionately hurts the working class and Biden knows that too.
What this is is a huge transfer of wealth from the middle class to the already obscenely wealthy elites. We are financing the profits of the rich with a stealth tax on the working class.
Posted by: Timothy Birdnow at
09:20 AM
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