Does the near-9% increase in the Dow Jones Industrial Average this week mean the economy has turned a corner?
By PBN Staff
Investors have reacted positively to the Obama administration’s episodic unveiling of its plans to support and regulate the nation’s financial systems.
That has driven the Dow Jones Industrial Average up to 7,924.56 points, an increase of 8.88 percent from last Friday’s 7278.38 points and 21.04 percent from the 12-year low of 6,547.05 points the index hit on March 9. Historically – although the markets did stage several such rallies during the decline of 1929 to 1932 – an increase of 20 percent or more has often signaled the end of a bear market.
The end of a bear market does not necessarily mean that the economy is close to coming out of recession, however. Do you think the recent run-up in the stock markets is the sign of some growing strength in the economy?
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