The economy as a whole does not need to do well. The tax cut helps capital incomes. The falling dollar helps US exports and profits, as long as it does not get out of hand, which it could. Also, still living in happy talk land of post-Iraq "victory" (those polls show most Americans don't give a hoot about the mess over there), and Big Al is talking about an interest rate cut. Yields on bonds suck right now compared to yields on stocks. And after three years of a bear market, some upward momentum can really feed on itself at this time. Barkley Rosser ----- Original Message ----- From: "Dwayne Monroe" <idoru345 at yahoo.com> To: <lbo-talk at lbo-talk.org> Sent: Wednesday, June 04, 2003 2:30 PM Subject: [lbo-talk] The Markets and Reality: What, If Anything, Is the Linkage?
> A question for the economists in the house.
>
>
> As I type this, the DJIA is at 9006.91. If the day
> closes on this high note, the public radio program
> "Marketplace" will play a snippet of "Happy Days Are
> Here Again" and the host will offer some fey
> explanation of why the Dow seems to be climbing back
> towards 10K.
>
> Meanwhile, as every well read lefty, increasing
> numbers of conservatives and assorted 'alarmists' of
> all stripes seem to know, there are deep dish problems
> with the US' economic situation that suggest a
> gotterdammerung crisis happening sooner or later.
>
> So, what's the deal? What's the real relationship
> between the Dow, NASDAQ, the rest of the market's
> structure and the real, nuts and bolts, deficit, trade
> imbalance, crazy tax cut, overcapacity crisis, foreign
> capital infusion dependent, layoff and prolonged job
> search economy?
>
> Is it possible for the Dow to look good while the
> country's economic health is really quite bad?
>
>
> DRM
>
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