|
Eb, sorry man, thats way way off. I've spent the last 15 years of my career in the investment industry. Clinton had zip to do with the boom in the 90's. The money that was in the stock market back then is still there, its just in more conservative investments such as money marketss or comm paper. There are a few explanations
1. 401Ks - go back 10 years ago, how many people heard of these? They were not the ideal retirement vehicle of choice. most of our parents had guarnteed retiremetns through pensions. 401ks and IRAs put investments in the hands of the people. Most, put it into the stock market, See next point
2. Internet, wireless, cable. This industry boomed. The common man (see above) put there investmetns in the stock market hearing of huge gains, for example Ebay trading at $400 a share. Insane logic by inexpericned investors. Greed through venture capital and inexperinced investors inflated the market. It was no longer about investing for long term gains , it was about making a quick buck.
3. Y2K - led to big paying jobs and projects in IT
3. Greenspan summed it up in 1998 or 1999, the economy was expericing "irrational exuberance". there was no basis for the amount of growth we were experiencing. It was a pure bubble.
When stock prices are up, companies have more borrowing power, they hire more people, they spend more money. Good for thw economy if thw growth was real.
In reality, as everyone expectred, it collapsed (or corrected). companies had to fund their investmetns, lay off people and stop rapid growth. It resulted in layoffs, companies folding and a recession.
For political reasons, Bush is blamed. He had nothing to do with it at all. Neither did Clinton.
I can argue all day about Iraq or terrorism but the president has minimal effect on the economy. the tax cuts were purely political, putting more $ in the hands of people. It will have little affect on corporate investments and no long term effect on the economy.
Please excuse all my spelling errors
|