ClusterGains

POB 339
6301 Highway 58
Harrison, TN 37341
ph: 423-344-3855
jso10130@yahoo.com

Economics

Economics plays a large part in whether the stock market goes up or down. If the economy is in bad shape, it won't matter if you have good stock picks. The economy will bring down almost all of the stocks. One economic factor is unemployment. If 250,000 jobs are lost in one month, and 265,000 jobs are lost in the next month, you cannot expect to make money in the stock market. Investing will only be safe if jobs are being created rather than lost.

Another important economic factor is the housing market. Building and buying houses stimulates the economy. If housing starts or existing home sales are decreasing, the stock market will not do well. Another factor is housing overhang. If the banks are holding on to a lot of delinquent mortgages, this means the housing market could be flooded with massive foreclosure sales at any time, and this will decrease new home sales. So, investors must do internet research to see if various economic factors will support a bull market.

Eldon Mast has an excellent blog that I recommend. It is called The Good News Economist, and it puts a positive spin on what is happening in the U.S. He gives facts and figures to show exactly the pulse of our economy.