Economy contracts as Dow rises, showing healthy stock market investment that could be trouble for jobs this year. MortgageA Mortgage is a document granting a lien on a home in exchange for financing granted by a lender. The mortgage is the means by which the lender secures the loan and has the ability to foreclose on the home. loanA Loan is an amount of money that is lent to a borrower, who agrees to repay it plus interestInterest is money charged for the use of borrowed funds. Usually expressed as an interest rate, it is the percentage of the total loan charged annually for the use of the funds.. interest rates also rose. And as usual, providing personal finance advice, real estateReal Estate is land and anything permanently attached to it, such as buildings and improvements. advice and consumer advice on the Ilyce Glink Show on February 3, 2013 at 11:00am Eastern Time on WSB Radio.
Welcome and pull up a chair. It’s Super Bowl Sunday! There are previews of the coming commercials all over the Twitterverse today. The commercials are of course why I enjoy the Super Bowl.
There’s also been so much other news this week, I think we have to take a step back for a moment. I think we saw an inflection pointA Point is one percent of a loan amount. this that’s so interesting and so meaningful, if I didn’t call attention to it I wouldn’t be doing my job for you. Of course we’re going to talk about mortgage loan interest rates as well because they went up, but it’s all part of the same thing. In short, the economy contracts as Dow rises. Two major events that happened this week to illustrate my point:
- The Dow went up past 14,000 for the first time in I don’t know how long. The all-time high of 14,165 is within reach. The health of stock market investment is nothing short of astonishing
- The rise of the Dow is so surprising because at the same time, we saw the economy contracting in the 4th quarter of 2012, down a tenth of a percent.
What happened? Simply put, the government cut back on its spending. What does that tell you about where we are? It tells you that the government stepping back, which many people want in the way of deficit reduction, exposes an economy not strong enough to sustain itself. We’re just not there yet.
To see that the economy contracts even as Dow rises is foreboding. If we keep kicking out the stools underneath us and cut spending, what does that mean for the near and distant future? Those are jobs. People will be out of work. Callers and I discuss.
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