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Why is the stock market going up?

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“The economy is barely growing, oil prices keep climbing, housing remains in a funk — and yet stocks are rebounding.” Why? That’s the question Gregory Zuckerman answers in a great piece in the Wall Street Journal earlier this week. It’s a simple primer for most of you, but I highly recommend you share it with confused and anxious baby boomer clients. And while he’s a bit pessimistic for my tastes, it’s still a dead-on explanation. A sample:

“Wall Street often goes in a different direction from Main Street, of course, largely because stock prices are bets on the future value of companies, as opposed to a report card on their operations and profits today. The market can climb when the business environment is rough, if there are signs that the future looks more promising.”

“The economy has not turned out as bad as most feared,” he quotes James Paulsen, chief investment officer at Wells Capital Management, as saying. “The unemployment rate is still low, job losses are much less than past recessions and profits — outside of banks — have remained stronger than thought.”