EDITORIAL: Mostly meaningless stock market

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Since Donald Trump took office, we’ve all been subject to the occasional Twitter barrage pointing our attention to the stock market, particularly the Dow Jones Industrial Average, which until last week followed a slow, steady, upwards pace. Trump was not exaggerating when he said the Dow hit “a new all-time Record” in a Jan. 5 tweet.

From a starting point of 19,827.71 at the close of the day Jan. 20, 2017, the day Trump took office, the DJIA hit its all-time apogee of 26,616 on Jan. 26, before beginning its plummet to, as of close on Tuesday, 24, 802.34.

Go ahead and do the math, if you like, to chart the percentage growth and fall, but you’re probably wasting your time.

Because the DJIA measures exactly one thing: a daily snapshot of those publicly traded companies on the index, each of which is trying desperately to wring enough cash out of itself so that people will continue to want to buy their stock.

Consider that 92 percent of all stocks are owned by the top 20 percent of American households. The top 1 percent holds 38 percent of the market.

We don’t have to look too far to find a company doing whatever it can to increase shareholder value: BH Media, a division of Warren Buffet’s Berkshire Hathaway, has been emaciating the staffs of the Greensboro News & Record and the Winston-Salem Journal since they took ownership, even putting the land beneath these newspapers on the table. Large, publicly traded companies are always looking to appease their shareholders. It’s the way of things.

And who are those people anyway?

A 2016 Gallup study put the number of Americans with a direct stake in the stock market at 52 percent — a historic low — which includes those with IRAs and 401(k) plans as well as individual stock and mutual fund owners.

At best, the bull or the bear directly affect only about half of us. And then consider that, according to 2013 Federal Reserve data, 92 percent of all stocks are owned by the top 20 percent of American households, by wealth. The top 1 percent holds about 38 percent of the market.

Sure, we’re all entwined in a complex economy, and it’s possible that some benefits of prosperity at the top do “trickle down” to the rest of us, who have at best minimal interest in the DJIA.

But the real action in the casino is a closed shop. The rest of us just provide the game.

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