Does the U.S. stock market’s current behavior make sense to you? If it does, you may want to take a closer look at the facts. According to Dawn Bennett, CEO of Bennett Group Financial Services and host of the Financial Myth Busting with Dawn Bennett national radio show, investors and everyday Americans alike should be more than a little confused about the state of the U.S. economy in light of recently released data.
The economy is currently in the throes of a paradox, in which the stock market has reached substantial highs—in fact, stocks are trading at record levels— yet other key economic indicators create a starkly contrasting picture of economic health.
For example, the country has reached one of the highest inventory-to-sales ratios in years, underscoring that retailers are no longer able to sell their inventory as quickly as customers are willing to purchase it. If the stock market was a true indication of the growth of the economy, would this be the case? This poor retail performance is accompanied by data that shows U.S. oil rigs have been falling in number for over three months straight; again, if the economy was on such an upswing, why are we experiencing such dramatic decreases in production?
Additionally, imports and exports are in a slump, shippers are filing for bankruptcy, and consumer confidence in the economy is waning. Yet still, many only focus on the growth of the stock market, and even then, fail to realize what history has taught us about the consequences of high level trading. For some, the success of the stock market is also reinforced by the strengthening dollar, which, while some interpret as a showcase of its dominance over foreign currencies, has proven time and time again to be an indication of global economic stress and turmoil that results in negative consequences for both foreign countries and the U.S. Major U.S. companies are already beginning to stir about how the strengthening dollar is negatively impacting their sales in foreign markets; we can expect that it won’t be too much longer before the hits to these companies become even more apparent.
So can we trust the stock market? It depends on who you ask. For those like Dawn Bennett who keep a critical eye on important macro data and historical trends, absolutely not. But for those like the government and the Federal Reserve, who benefit from an optimistic narrative, it’s blue skies ahead.
Bennett Group Financial Services LLC, based in Washington, D.C., is a comprehensive financial services firm committed to providing opportunities to clients’ as they seek long-term financial success. Its customized programs are designed with the potential to help grow, lower overall risk and conserve client assets by delivering a high level of personalized service and skill.
For more information, call 866-286-2268 or visit http://www.bennettgroupfinancial.com
Securities offered through Western International Securities Inc. (WIS), member FINRA/SIPC. BGFS and WIS are separate and unaffiliated entities.
About Dawn Bennett
Dawn Bennett is CEO and Founder of Bennett Group Financial Services. She hosts a national radio program called Financial Myth Busting http://www.financialmythbusting.com
She discusses educational topics and events in the financial news, along with her thoughts on the economy, financial markets, investments, and more with her live guests, who have included rock legend Ted Nugent, as well as Steve Forbes and Grover Norquist. Listeners can call 855-884-DAWN a as well as take podcasts on the road and forums for interaction.
She can be reached on Twitter @DawnBennettFMB or on Facebook Financial Myth Busting with Dawn Bennett or firstname.lastname@example.org