10/22/09 Stockholm, Sweden – “Two Americas; trust me it’s more than a campaign slogan,” writes Robert Lenzer for Huffington Post.
On the one side are the dizzying market “rally,” and the Wall Street compensation and bonuses that have grown right alongside that beast. On the other side is the rest of the economy which, in stark contrast, is filled with people losing jobs and who are unable to make ends meet. His point? It’s simply that “a bull market can’t last forever in a weak economy.”
On the jobs front, roughly 2.5 million open positions are being chased after by about 15 million people. While the length of time it takes to find work continues to increase, Americans still wrestle with record levels of debt that they try to pay down.
Interestingly, as a panacea to the masses, the Federal Housing Administration offers mortgages with only 3.5 percent down. And, in that particular offer the second America does get treated a bit like Wall Street. As Lenzer notes, “that’s leverage approaching 30-to-1, the kind that brought down Bear Stearns and Lehman Brothers.”
The current phony rally can offer the illusion of a growing economy, but if it’s not linked to change and real growth in that “other” America… the one most of us live in.. it’s a phony boom.
More details are available in The Huffington Post’s cautionary tale of the weak economy and the bull market.
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