Thursday, January 3, 2008

Employment reading has a positive effect on the stock market.

I am always hearing employment levels are good in spite of the subprime lending crisis. According to Warren Buffet (the second riches man in the world ) is that America would not got through a recession as long as employment is high. I see a lot truth to that statement since the Dow open today stocks have climbed high right after employment rates were said to be good. Of course it makes sense ,if their are more jobs hopefully their should be more income being distributed through out the economy.This theory also has holes in it too.

Because sometimes an economy might have a bounty of jobs but the jobs could be paying relatively nothing. This effect would drive the GDP (gross domestic product )lower ,which I believe by dividing GDP by population and comparing it to other nations gives you your economic stability. I really think their shouldn't be a recession this year ,and i also think that real estate prices are going to pick up by mid 2008.


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