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.
(snip)
“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.
5 comments:
Woof! You say an unruly guide dog (I doubt it was a police dog) led an entire plane plane load of people off the plane in protest? Did security put the cuffs on him? Does he need bail?
What organizational skills. Does that doggy have brothers and sisters who share his compassion and resolve?
Get him a ticket on a cruise ship next, then a football stadium. Let's see how far he can take this.
As the stock market goes up, so it can come down. Perhaps just as abruptly and deeply as it did in 2008.
Good luck to us all when that happens, as we will no doubt, once again be bailing out the very crooks that brought calamity upon is.
We are playing Russian roulette with the economy. For the past five years, as I no doubt have mentioned before, I've been dancing between the toxic rain drops, managing our finances. Late to personal financial management (I started in my fifties), I only started out of sheer necessity. Since the early 80's I have been aware of the increasing idiocy of this country's economic policies. I expected the disaster of 2007-2008, but not its magnitude nor the government's dismal failure to deal with it. And, no Zee, it's not government itself to blame but our kind of government. I agree largely with Krugman and people like Yves Smith on our dilemma, its causes and possible solutions, but despair of our government's recognizing the first or implementing the second.
Karen,James, Zee, Jay and friends: This is my recent simplistic comment
to Krugman's 'A Permanent Slump'. Sorry it isn't more cheerful.
"What truly depresses me is the message that things are as they are because that is how it is, period. This is merely a way of obscuring the fact that much can be accomplished to change this dreary outlook but no one is interested enough to start the ball rolling. Yes, that would require
investigation, honest reporting, courage to expose where the money really is, how it is being used, and ways to turn things in a different direction. I guess we will have to wait for the populace to wake up and become a wave of opposition to what is failing but then again, this requires knowledge and information to be shared. It all sounds simple, and it really is but nothing
can happen until citizens begin to flex their political muscles. Meanwhile, by not improving, the financial polls will continue to edge downward and l929 will happen all over again. This I can safely predict without any doubt, and I don't even have a degree in economics.
Maybe another FDR will emerge from the rubble."
Karen, you've really been on a roll lately!
As you said in this column, "... 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. [...] Plus ça change, plus c'est la même chose".
Yeah, that's it all right, after each crisis, no genuine fixes, just a continuing downward spiral for most people.
"Quantitative Easing" should be renamed "Quantitative Teasing", for it suggests a reward that is unlikely to be delivered to the bulk of the populace. For most, it's just a financial striptease on our political stage — look, fantasize, but if you try to touch, you'll be ejected forthwith!
However clothed or disrobed, the central agenda from Republicans has for many decades been an augmentation of the benefits reaped by the upper class. "Against" that we have seen most Democrats of the past 30+ years do a fine job — not of seriously pressing for a more equitable distribution of the fruits of labor and national wealth, not even of fixing the problems and fighting for simple opportunity for all, but rather, of showing how accommodating they can be towards an unbridled-Capitalism/ Social-Darwinistic agenda, and, of course, getting themselves elected/re-elected by fooling that portion of the electorate that is not yet politically catatonic into believing that they as politicians will actually fight for the benefit of the people.
Nice to see you referencing Franz Fanon. Some of the plutocracy probably have no idea of what institutional oppression really does to people, physically and psychologically. But I'm beginning to think that the greater proportion of those with economic and political power do in fact know, but are supremely confident that they, the plutocrats, will be able to control the negative consequences. Right now the discontent is still just simmering, and the plutocrats have put a lid on it. That actually raises the pressure and practically guarantees that the pot will boil over. But I have no idea as to when that will occur.
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