Where are we today in terms of economy? Stock soars, consumer sentiment lags. A current to 1929 data comparison suggests we now may well be on the way to a depression, if the rescue efforts are not shifted to the real economy.
The major stock market index, Dow Jones Industrial Average, jumped from 6763 on March 3 to 7608 on March 30, an astonishing 12% surge in this bellwether section of the financial sector. Unfortunately, according to University of Michigan survey, Consumer Sentiment, the greatest barometer measuring health of the real economy, stayed at 57.3 by the end of March, statistically dead even with the February reading. Moreover, according to Labor Department, job situation in the US was still worsening in March.
Considering in healthy economic development, consumer sentiment is always a key factor impacting stock trend, what does this sharp contrast mean? It is very clear that the current rescue plans have been stimulating a bubble in the financial system and did nothing in terms of rescuing the broad economy. A large number of millionaires have been created in March alone in the financial sector. But the financial conditions of average consumers did not even see a slight improvement. What could this be other than amplifying the extreme inequalities?
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Having been in business for over 16 years, Amlink International is a leading global business consulting firm, providing a variety of China business services such as joint venture negotiation, government relations, business setup consulting, import, export and logistic services. Amlink also provide extensive China travel assistances to business travelers. In the past decade, Amlink has successfully negotiated a large number of business agreements between US firms and Chinese manufacturers.
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