![]() ![]() Government saving, on the other hand, has been a huge, huge boost. Clearly, those first three items will be drags for the foreseeable future. This is the kicker for the stock market:Ĭorporate Profits = Investment + Dividends/Buybacks – Household Saving – Government Saving – Rest of World Saving As I noted in my piece saying this wasn’t the next Great Depression, the government’s response has been massive here. The stock market will always sniff out a recovery before the data shows it because people are setting prices based on what they expect to happen, not what is actually happening.īut here’s the big thing the market is grappling with right now. In that case, the market was obviously right. The stock market is anticipating years of future growth. In November of 2009, when the financial outlook still looks dreary, the stock market was up 53% year over year while the economy was up 1% year over year. To better understand how the stock market thinks let’s review the 2009 recovery. Sometimes right, sometimes wrong, but never in doubt. Market”, a man (yes, a man) who is bi-polar, constantly screaming out his opinions in a manic way. Warren Buffett always describes this as “Mr. ![]() What is the stock market doing today series#The stock market’s fluctuations are a series of guesses about future outcomes. So, while we see everything for what it is, the stock market is looking for what it might become. How is this possible? What is going on? Is it all a conspiracy by the Fed? Are stock traders just insane? All of the above? What do we make of all this? Let’s talk about it.įirst, the stock market is forward looking. And the economy just had one of its worst months ever. CNN Sans ™ & © 2016 Cable News Network.The stock market just had its best month since 1987. Market holidays and trading hours provided by Copp Clark Limited. All content of the Dow Jones branded indices Copyright S&P Dow Jones Indices LLC and/or its affiliates. ![]() ![]() Standard & Poor’s and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Chicago Mercantile: Certain market data is the property of Chicago Mercantile Exchange Inc. US market indices are shown in real time, except for the S&P 500 which is refreshed every two minutes. Your CNN account Log in to your CNN account ![]()
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