Tuesday, October 21, 2003

Voodoo Economics: The Dow is approaching 10,000! Again!

The Calico Cat, a business blog, rightly ridicules those who look for some hidden meaning in the DJIA surpassing the 10,000 benchmark. It's nothing but a big, round number, and it doesn't hold any more significance than 9,999.

But politically, it's going to be huge. For some reason, the public looks to the Dow as an indicator for how the entire economy is doing, and not for what it is -- an index measuring the stock value of a few large companies.

So if the Dow surpasses 10,000 and maintains a high level, you can expect news coverage of the stinky economy to decline. Although Democrats will still be talking about deficits and unemployment numbers, Republicans will be boasting that their tax cuts fixed everything. So goes the business cycle ...