Charlie: Oh I had some bets down for you. You saw some money.
Terry: You don't understand. I coulda had class. I coulda been a contender. I coulda been somebody, instead of a bum, which is what I am, let's face it. It was you, Charley.
As we approach the jobs report on Friday and potentially the first in many steps by the Federal Reserve to remove the punch bowl it's a great time to reflect on what this economy could've been. Despite mountains of money from the Fed, our economy has only muddled along with even the bright spots coming with glaring asterisks (lots of subprime auto loans and lots of big money, not Main Street, in housing recovery). The fact is the Fed's work hasn't had a lot of impact on regular people and the hype about its impact on the stock market is exceedingly overdone.
Cheap Dollar Never Cheap Enough
The dollar never got cheap enough internationally to make much of a difference in trade or bring home enough manufacturing work. In fact any jobs coming back to America stem mostly from costs escalating in other nations. As for impacting corporate profits there are two things to understand.
A) Most analysts crunch numbers in constant currency
B) The dollar hasn't helped especially with faster growing economies
LinkedIn was criticized when its shares doubled in the first day of trading for leaving money on the table. Ironically, many market experts at that time said the stock was overvalued. Many felt Facebook (FB) did it right by taking every single nickel possible from the public, which thought it could share in the company's meteoric growth. If they held on right now, those dupes would be breaking even. In the meantime LNKD is up more than 100% from its closing price on the day of the offering, and now the company is raising a billion dollars, selling 4.2 million shares (three days of trading volume) and will still have 90% of its shares outstanding on the books.
Management didn't have to give investors the shaft. Moreover, they say funds are being raised to make acquisitions and investments, which mean they view their shares with more esteem than cash - that's a most bullish statement.
Attacking Syria will not impact the personal lives of anyone on the planet outside of Syria, so its fundamental impact on the economy is limited. I think yesterday the Street misinterpreted the fading rally as fear over war increased. When John Boehner came on board with a limited strike on Syria, it hinted at a sort of sycophantic relationship with the White House on the eve of two major battles. If the Speaker isn't going to play hard ball on each situation, then we could be looking at a blank check for President Obama, more debt, and less fiscal restraint.
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