By Merrier Spaeth, KERA 90.1 commentator
Dallas, TX – In this age of sound bites, we're prone to ask, "What's the bottom line?" Meaning - just tell me one thing... I'm Merrie Spaeth for Marketplace Midday.
Is the market going up or down? Is the bottom here yet, or not? Is the economic news good - or bad?
The weekend business news, which starts off this week's activities, illustrates one problem. All three of the major indices - the Dow Jones, Standard and Poors and NASDAQ Composite - fell last week, but by minimal amounts. One report showed a decline in consumer confidence. Gasoline prices went up - a lot. That hurts airlines and companies which need petroleum. Unemployment claims went up. So far, pretty bad. But buried in Saturday's stories was good news. Really, very good news.
Retail sales rose. Let's pick the numbers apart. Car sales were up, but car manufacturers are pushing sales with every gimmick under the sun. Ford is actually losing money on each car it sells. They're trying to keep factories running, and the heavily unionized work force busy, until their contracts expire. Then, we'll see a major wave of plant closings. So forget car sales as an indicator of what's going on long-term. But, the cost of food declined. Ditto for computers. Furniture sales rose - related to the housing market. Other weekend news showed that inflation is basically nonexistent. For bonds, interest rates stayed very low - that's good for the overall economy.
So - the bottom line is - there isn't one bottom line. Investors should invest based on what they believe is the long term, inherent strength of our economy. In other words, you have to think, assess your own needs, and make your own decisions. And maybe that's the real good news. For KERA Marketplace Midday, I'm Merrie Spaeth.
Merrie Spaeth is a communications consultant in Dallas.