Updated Feb. 28, 2013
While it’s heartening, don’t get exuberant over the Dow Jones Industrial Average passing above 14,000. The lofty height doesn’t mean the U.S. has a healthy business climate, despite what Wall Street analysts hope.
The nation has huge economic structural issues.
Let’s get real. The Federal Reserve’s practice of printing money only offers false hope. The U.S. Commerce Department just reported the nation’s economy is stagnant – it shrank in the last quarter.
A new study reveals an alarming trend — why startups no longer lead in job creation.
True, workers with 401 (k)s are happy with the market. But my economic view is based on what I see happening at a common-sense, Main Street level. The flirtation with 13,000 only means investors aren’t currently worried about two developments:
- The Euro-zone economic issues.
- China’s central banks have eased lending requirements.
Everyone seems to forget that much of Europe is mired in a recession.
Here in the states are several economic ramifications: Poor public policy, e.g. Keystone Pipeline and other developments, as well as adverse current events mean crude-oil prices are skyrocketing. The resulting price at the pump will not help the economy. The average American motorist will cut back on other expenditures and necessities with gas at $4 a gallon and climbing.
Nordstrom is doing well and rightfully so. But the middle class is disappearing and lower-income shoppers favor retailers like Wal-Mart. And Wal-Mart has been a loser on Wall Street. That’s a result of weaker sales, its worst-ever February, and a comparatively dismal outlook.
Unemployment is still high. Don’t buy into the 7.9 percent unemployment rate. The true figure is at least 15 percent. Employment rolls are fattened because millions of Americans are working as temps without benefits. Far too many people have given up and are trying to freelance.
At a record rate, millions of Americans aged 62 have filed for early benefits.
Plus, even for those lucky to have a job, wages are flat. But companies are losing much of their intellectual capital as age discrimination is rampant in favor of younger workers. Ironically, savvy employers know that “slow motion gets you there faster.”
Don’t be misled about the rate of home sales in some areas. However, sales increases were attributed to investors capitalizing on distressed prices as sales prices continue to drop. Not good. Look for another round of foreclosures now that the deal has been signed between lenders and states attorney generals.
Besides, the average victim from the predatory mortgage practices only got a settlement of $2,000.
Long term, the payroll tax extension will only hurt workers. It means retirees will get less money from Social Security when they leave work.
What’s needed is economic vision in public policy to benefit this nation. (For Op Ed economic and public policy analysis by noted economist Peter Morici, click here.)
From the Coach’s Corner, consider 12 tips for profits to keep your business dreams alive.
A blind person asked St. Anthony: ”Can there be anything worse than losing eye sight?”
He replied: “Yes, losing your vision!”
Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry.