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March 6, 2013

Dow Hits Record High Amidst "Golden Age for Corporate Profits" 
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Global markets have soared after the Dow Jones Industrial Average hit
record levels. The Dow rose 0.3 percent on Tuesday, surpassing a
previous high set in 2007. The news had a ripple effect, leading to
strong gains in stock markets in Europe and in Japan. The New York Times
reports the United States is in the midst of a "golden age for corporate
profits." The boom is partially attributed to high unemployment, which
allows companies to keep wages low. Recent figures show corporate
profits accounted for more than 14 percent of national income in the
third quarter of 2012, its largest point in over 60 years. The portion
of income going to employees was nearly 62 percent, its lowest point
since 1966. An analyst at Bank of America Merrill Lynch said the recent
sequestration will have a "minimal" effect on corporate profits, adding
that nonetheless "the market wants more austerity."

 

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