Robert Stein 1924-2014

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Wednesday, October 14, 2009

Disconnect: Dow 10,000, Jobless 10 Percent

Symbolism comes with a heavy hand these days as Stock Exchange traders cheer at the Dow hitting 10,000 while the national employment rate heads for double digits.

The disconnect between Wall Street and Main Street keeps widening as money jugglers, who caused the credit crisis that led to bailouts with taxpayer billions, are getting record bonuses while those who do real work in the world, such as airline pilots, with hundreds of lives in their hands daily, are seeing their salaries slashed.

(On the Daily Show, Captain Sully Sullenberger, who saved 153 by landing safely in the Hudson River last January, has Jon Stewart shaking his head over the cuts.)

Today's stock market rise was fueled by JP Morgan Chase reporting a $3.6 billion third-quarter profit with the expectation that other banks and brokerage houses will follow suit.

Meanwhile, interest rates remain at record lows, a juxtaposition that will tempt Americans, such as retirees and near-retirees with IRAs, who can't afford the risk to put their money on the line again in the Wall Street casinos in the hope of getting a decent return.

Recognizing this disparity and the fact that Social Security recipients next year will not see an increase in their checks for the first time in three decades, the President asks Congress for a one-time payment of $250 to seniors and disabled Americans, just about the amount that Wall Street movers and shakers will tip the doormen at their Manhattan apartment houses.

Amid all the talk about employment as a lagging indicator in the recovery, it's clear that who in this economy gets paid off first.

Something serious is amiss when the most apt comment on the stock market rise comes not from the Obama Administration's financial wizards but House Minority leader John Boehner, not previously known for economic acuity:

"At the end of the day, the American people aren't looking at the stock market in terms of putting food on the table. They want jobs, and they want them now."

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