All this talk about the Dow Jones Industrial Average closing above 10,000 points on Wednesday has me crazy. As if it matters! Yes, the stock market is rallying. That’s a good thing for investors. But what about the double-digit unemployment that still plagues our nation? It will still be a long time before employment returns to pre-recession levels, and there’s no guarantee that good news in the stock market will pave the way for good news in other economic sectors. We can hope, but that’s all. Finally, readers who have come across my investing mindset already know what I’m going to say: Don’t let any stock market index passing some arbitrary number influence your investment strategy. Invest consistently and invest for the long run. That is all!
That said, since the Dow crossing 10,000 was so important to the media this week, I want to focus my weekly roundup on other bloggers’ reactions to this landmark (however arbitrary I think it is).
Financial Highway (@moneyhighway) sums up my thoughts with his post Dow Jones 10,000 So What?
Get Rich Slowly (@JDRoth) is becoming a regular in my link-ups, but there’s good reason—he’s got good stuff over there. This week is no exception with his post Dow 10,000 and Other Nonsense. We see eye-to-eye on this one.
The Digerati Life (@TheDigeratiLife) hypothesizes that we’re not out of the woods yet…by a long shot…in Double Dip Recession: Why Dow 10,000 May Not Last.
Zero Hedge reveals something shocking about this week’s stock market news in Dow 10,000!!!! Oh Wait, Make That 7,537.
Robert Reich, one of my favorite economists, has another great post explaining why there is no connection between this stock market craziness and the rest of the economy in Why the Dow Broke 10,000 and Why You Should Still Watch Your Wallet. In his words: “this is all temporary fluff, folks”.
About David E. Weliver
I agree, it is arbitrary. But investors, as a whole, seem to care about it. There must be some fascination with certain milestones because we all want to talk about it anyway, and I notice the market hype when certain things happen — including when “magic numbers” are hit.
It’s also possible that it’s simply the market’s behavior that’s getting us all talking: we’ve reached some kind of peak for the year, and with market action like that, people can’t help but buzz. Don’t think it’ll last too long though!
Thanks for the mention and the great insights!
I agree, too. There are a mess of factors that are weighing on the economy and I think the markets are just acting oblivious to them. Ignorance is bliss. Until the education comes.
Peter Grandich called this a “Melt up” and it’s just a lot of hot air basically.
Today’s move in the markets seem to be suggesting that. For me the best thing is to get out of all debts and into things that retain wealth.