In early trading, the Standard & Poor’s 500-stock index crossed the 1,800-point mark for the first time, and the Dow Jones industrial average surpassed 16,000 points for the first time. By midmorning, the S.&P. was flat, at 1,798.46 points; the Dow was up 0.3 percent, at 16,003.86; and the Nasdaq composite was off 0.1 percent, at 3,981.85 points.The stimulus will keep jazzing the "folks" at the very tippy top. The rest of us keep looking skyward for all those golden drops to shower us with beneficence, and we wait in vain.
With intervention from the Fed seen keeping interest rates near zero for the foreseeable future, equities are expected to continue to attract yield-seeking investors even after the Fed begins to slow down its monthly asset purchases. More clues to the Fed are expected with the release of the Federal Open Market Committee’s meeting minutes on Wednesday.
“Interest rates are not going to go anywhere for the next year and a half or two,” he (Peter Cardillo, chief market economist at Rockwell Global Capital in New York) said. “As we approach 1,800 on the S.&P., that’s going to see some resistance,” he added, but noted that “all the ingredients are there for the market to go higher.”And higher and higher and higher.... till what? They don't tell us. All they tell us is that SONY sold a million X-boxes in the first 24 hours they were on sale in the USA. As long as there are still people who can afford overpriced electronic gizmos, everything's hunky-dory. Luxury for the few, austerity for the many. Bubble bubble for them, toil and trouble for us. And they never see it coming. And when it comes, the plutocrats appoint themselves as the only experts able to "fix" what their greed wrought by inflicting even more pain and extracting even more blood and treasure from the body politic so as to "grow" the economy.
And all this ties in so pleasantly with the news that Obama Treasury Sec. Timothy Geithner is becoming president of Warburg Pincus, a private equity firm, even though he has no experience in actual banking. Scuttlebutt has it that Geithner was hired purely for his name value. His role, according to the New York Times, will be to act as a human magnet for all that hoarded stimulus money just hanging around doing diddly-squat while it's being kept from actually doing the greatest good for the greatest number. OK, so I'm paraphrasing. The VIPs themselves are much more circumspect:
While Mr. Geithner has been given the lofty title of president, several private equity executives questioned whether he would be much more than a prominent name who would help Warburg Pincus open doors on the fund-raising side, especially with foreign investors like sovereign wealth funds.Plus ça change, plus c'est la même chose.
Anyway, here's my comment on Krugman's depressing piece, specifically about the "easy money" of the continuing backdoor bailout of Wall Street:
If easy money will be with us for a very long time, it sure isn't landing in the right place: the pockets of real Americans. None of that monthly $80 billion of corporate welfare known as quantitative easing ever trickled down.
Wealth disparity is now so extreme that a former Fed official named Andrew Huszar just publicly apologized for Q.E. in the pages of the Wall Street Journal.
The richest 400 Americans have the same combined wealth of the bottom 150 million, or half the population. Yet they even begrudge us the crumbs of extended unemployment insurance. a living wage, and decent SNAP benefits for hungry kids.
So -- how about just writing monthly checks to every American to help end the stagnation and kick-start the job-creating cycle? Send the Q.E. where it will do some good. Memo to Janet Yellen: Pump it up, cure the slump X 330 million. Citigroup need not apply.
Better hurry up, because change is in the air. Revolutions start in dribs and drabs. Wage slaves are walking out of Walmart and fast food gulags. Teachers are marching with immigrants on the streets of Chicago to protest the neoliberal takeover of schools and infrastructure. When United (sic -- should be U.S.) Airways kicked a blind man off a plane last week because of an "unruly" guide dog, every single passenger walked off the flight in solidarity.
“When we revolt it’s not for a particular culture. We revolt simply because, for many reasons, we can no longer breathe.” -- Frantz Fanon.