Ateneo Professor on Entrepreneurship
From Money News on DJIA
The Dow Jones, according to real estate magnate Sam Zell is kept artificially high by Fed Reserve Bank liquidity measures. As of now the Fed Bank is engaged in QE3, buying $40 billion worth of mortgage backed securities monthly.(injecting liquidity into the system. The liquidity does not move into long term investment like capacity build up like factories but short term investment like stock market)
The uncertainity comes from the spending cuts and tax breaks stopping, more popularly known as fiscal cliff. The US congress has yet to act on the replacement legislation.
The Dow should be at 9,000, falling by 4,000 if the US Fed liquidity were factored out. DJIA is at 13,000 now.
Read more on real stock prices at Dow Jones by Zell
Do you agree with Zell?
Why is this post imporant to entrepreneurship? for the PHL entrepreneurs.?
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