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Strategies & Market Trends : New US Economy Policy
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To: Arthur Tang who wrote (12)3/6/1997 8:07:00 AM
From: Arthur Tang   of 435
 
The new economy and the individual stockholders

The new economy is based on demand side economy. The job growth is based on the product attraction that consumers have. The maintainence of job growth is the earnings of businesses. The earnings of businesses drive the stock value up. Wall street analysts project and manage the earnings of businesses, so that economy continue to move up. so, eventually, the owners of stocks gets the wealth from the businesses' earnings.

The flaw at the moment is that the individual who does not participate in the attaining of this new wealth. Labor try to sqeeze the management for better standard of living. Higher and higher wages are sought. Management try to squeeze the labor for better and better productivity. More and more layoff or shut out and move the plant abroad for cheap labor at any cost. The happy medium is of course, a steady wage and some advantage in purchasing company stock, when performance of labor exceeded expectation. ( meaning earnings went above projection to get stock options)

Stock option, of course is not the whole picture. Wall street still has to reach the distribution workers who like to own the vendors' stock. And the consumer who likes to own all the companies he or she does business with.

When Wall Street gets back all the individual customers; this America of ours will prosper, because of a good wage plus ownership appreciation of assets, via stock ownership. No one will sabotage any business. We will all be rich!
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