Okay folks, I really, REALLY meant to restart blog posting with another article in the series entitled "Planning Basics" but I found
this article at Econobrowser by Jim Hamilton such a good read I had to share it with you. In it Hamilton presents two superb graphs: one of total non-farm payrolls over the decade and the other of corporate (S&P 500 as proxy)earnings. Wonder why stocks have gone nowhere over that time period? The article contends these are highly suggestive of the answer. Here's a peek.
Pure carnage. Now for S&P 500 earnings:
(Click on either image for a larger view.)
The same. Of particular concern is the increase in earnings variability as the economy has become more geared to the financial sector (30% at one point). Since the sector profits through various types of "transactional taxes" if you will, I believe it would be a very good thing if we substantially decreased our reliance on this mechanism of "growth".
No comments:
Post a Comment