The Dow Jones Industrials And The Real Economy

The following are 10 year charts for the major stock indices:

Dow Jones 30 Industrials

NASDAQ Index (3000 Companies)

S & P 500 Index

The chart below shows the real wage changes of low-, middle-, and high-wage workers, corresponding to wages at the tenth, fiftieth, and ninety-fifth percentile of the wage scale (source http://www.jobwatch.org/):

The Bush Administration is very good at "spin" and deception so they have switched the campaign focus from their failed national security record to the economy as a benchmark of their achievements. As usual, the devil is in the details. The recent record high of the Dow 30 is the least representative index of the growth of the economy. The Dow 30 is the oldest of the major indices but it only measures the growth of the top 30 companies. The NASDAQ 3000 and the S & P 500 measure much broader markets and are both well below their all time high levels. Another interesting trend in all 3 indices is the growth levels from 1996 to 2000. The years between 1996 and 2000 represented the highest growth level of the 3 major indices in our history. All of the growth of the economy between 1996 and 2000 followed the largest tax increase in history in 1993. In addition, the final chart of Real Wages confirms the fact that this so-called growing economy only helps the upper 5 percentile.

In summary, the Bush economy has been great for the 30 largest companies in the U.S. and the upper 5 percentile of wage earners. The MSM has the same information that I have about the real economy and yet they persist in distorting the record of the Bush economy by emphasizing the Dow 30 record. If the Dow 30 is representative of our economy, I think Dow Jones should start another index. I would call it the Dow 30 Index of Real Wages. It would measure the growth of the 30 richest Americans. If they had an index for that, I am sure that it would make the Dow 30 look like it was underperforming. And it what not change the state of the the real economy and real wages which are both lagging behind the upper classes of our economy.