MSNBC’s Tamron Hall is now talking about how the DJIA is below 7000 and that it is the lowest level since 1997 and that it means “that all of that wealth created since 1997 and today, is now gone.” And that simply isn’t true. It means that the wealth was removed from the market, and that actions taken by companies to reduce costs, or consumption of manufactured goods/services, simply isn’t on par with perceived value. But the money, could either have been lost due to declines, or removed into other markets or liquidated altogether into cash/gold or some other tangible good. It is still amazing that people view the DOW/DJIA as the major factor of value in the US economy. People need to move away from these purely technical calculations, and I’ve love to know how many people perform technical analysis as opposed to fundamental analysis of companies. I know where I fall in that analysis. I prefer fundamentals, because technicals lead to a heartless evaluation and could miss something that management is doing behind the scenes.
It doesn’t mean it is lost. This could lead to a horrible uptick of inflation.
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