Every one tries to predict the future. Will the market go up, will it go down, will it go sideways, or should we just buy ammo and canned goods and pray? The market goes nuts, loses 1,000 points in a day, oil companies are getting creamed due to the BP spill, and volatility is creeping back to the levels of 2008. Why would anyone be optimistic?
I cannot claim to predict the future – nor would I want to (another post, a little more philosophical). But I keep my eyes open. The economic picture in our country is one big food chain. Remember in grade school they taught you that the largest animals ultimately depended on the smallest; i.e., lions depended on gazelles, who depended on vegetation, who depended on water & sun, etc… It is the same with the economy. Wall street banks depend on companies to make deals, those companies need cash to do that so they need to have sales, sales are only generated by people purchasing items, people only purchase when they have cash, and they only have cash when they have jobs.
I guess to shorten that, so goes jobs, so goes the economy. It can also work backwards, where if you see hard times ahead you start to layoff people trying to save your business. But the theory is they walk hand in hand.
As I walk around, I have noticed signs everywhere looking for help. Restaurants, hotels, gas stations, home depot. Accounting jobs are pretty stable in any economy (you need to count to see how much you made OR how much you lost), but blue-collar jobs tend to fluctuate to a greater degree. I was just in Seattle and there were at least 5 help wanted signs within 5 blocks of my hotel.
I just took a call yesterday from a sales rep I know at a payroll services company. I asked how his biz was doing, and was surprised when he said they were having a great year. They were up over 20% over 2009, they were not only seeing increased hiring at the firms they were with (their business model is based on headcount), but also an increase in new customers.
Again, the market may tank even more as we deal with the oil debacle and border control and whatever else pops up, but the base of our infrastructure, the jobs outlook, seems to be turning around. With that I will have money in the market, just because I believe we are looking up, not heading back down.
