Anybody look at the stock market lately? Here on Thomas Jefferson Street we tend to focus on politics and polls, whereas, as the late great congressman from South Boston--Joe Moakley--used to say, most folks view life through their kitchen window. Or, in the last few years, through the prism of their battered 401(k)’s.
But yesterday the market closed with the Dow at well over 11,000. That is a far cry from the 14,000 peak, but hey, it's not called "playing" the market for nothing. Wall Street is like Vegas. If you want a safe return, buy a certificate of deposit. If we get to 12,000 or 13,000 in the next few months, that is some pretty healthy territory. Those of us with graying hair can relax a bit, as our individual retirement accounts recover. Depending on what kind of mix of stocks and bonds you had in your account, you may even be closing in on where you were before the crash.
Americans are paying off debt and saving more--that's another positive sign for the future. Businesses have so much cash that they are buying back their own stock. The auto industry bailout, and even the much maligned Bush-Obama TARP bank rescue, seem to be working, with corporate America paying back the Treasury.
What is missing, of course, is hiring. But if I remember what I learned after dragging myself out of bed for my Econ 101 class, that is usually the lagging indicator in a recovery. We are in a bit of a vicious circle, with businesses not hiring until consumers start buying, and consumers not buying until employment picks up. At some point, though, the animal spirits will change from dread to exuberance.
Long term, we got problems to fix. But it looks like we've weathered the storm. Westward, hey, the sky is bright.