What’s behind the historic stock market highs and how it relates to the overall economy

Geoff Bennett:

As we reported, this has been a big week for the stock market. Not only did the Dow Jones close above the 40000 mark for the first time today. The much broader S&P 500 and the Nasdaq also reached record highs this week.

The markets have rallied back from the recent lows of 2022, and the Dow is about 40 percent higher than when the pandemic started.

Roben Farzad joins us now. He’s the host of public radio’s “Full Disclosure” podcast.

It’s always great to see you, Roben.

So how significant is it that the Dow hit the 40,000 mark? Because the Dow doesn’t tell us as much about the economy as the S&P 500 does.

Roben Farzad, Host, “Full Disclosure”: It’s a great talking point. Everything is kind of feeling pricey right now, whether it’s housing, crypto, gold, stocks.

Then again, at the turn of the century, there was an infamous book called “Dow 36000.” And it took forever for the Dow to even visit 20000, 25000, much less 40000. There’s another school’s thought that says the Dow should be far higher if it was more rationally planned, for example, if Apple or Amazon was added, or if there were other components right now that more represent this economy than the old economy components that are still in it.

So — but we will take it. But nothing is really cheap in this really peculiar economy.