Today, Friday June 10th the DOW dropped beneath 12,000 and unless it somehow regains miraculously the market will be heading toward its 6th straight weekly loss. As a reminder, the last time the market had this many repetitive down weeks was May, 2001 when the dot-com bubble POPPED. The recent downfall can be blamed on numerous things including weak economic news and low job-reports. Be that as it may, I am predicting things will get worse before they get better. You may be asking yourself… “Who is this guy to say that market will continue to decline?” I am no financial profit, but it doesn’t take a rocket scientist or a statistician to know that our economy is weakening. I am sure that pretty soon we will hear President Obama exclaim “We inherited this,” as it has become his preamble to every policy proposal and economic statement. Truthfully, we can blame our economy’s current state on many different entities. BUT, pointing fingers doesn’t fix anything. The 20% market gains we have seen within the past year have fallen some 5% since June began. Investors and advisers alike are becoming leery as past downfalls are not forgotten.
Just as today’s stock market needs a boost, so does our economy. Where do we find solutions in a time of fear and frustration? I believe that job creation and retention lies at the root of the problem and is key to its solution. Current policies like the North American Free Trade Agreement have only hurt our job market. Cheaper labor is constantly sought after to reduce overhead expenses and to maximize profits. However, the consequences for those earnings are Americans without jobs. The unemployed who once spent their hard earned dollars in local businesses are unable to continue spending and as a result we are seeing more and more closed doors. This trend spreads widely across the country and its effects are daunting.
Until we see legislative changes that give incentive to companies who provide American’s with jobs the trend will continue. Our country needs more loyalty; I remember when MADE IN AMERICA once meant something. Today the few domestic products we have are overlooked for the cheaper option made on foreign soil. Even what consumers believe to be American made goods often consist of foreign made parts. When will our government learn that there is a direct correlation between sending jobs overseas and stability in our economy? For any market to thrive there has to be a source of income. We must bring back jobs to America, it is pivotal to ensure stability for our country. Only then will we see a rising DOW and break the cycle of market downfalls.
~ J. Alex Lewis
No comments:
Post a Comment