The "American dream" lives. Note today's chart, which shows the new yearly high in Home Depot (HD)...
Home Depot is one of our favorite "real world" indicator companies. As the country's largest home improvement chain, HD's stock rises and falls with America's ability to spend money on new flooring, kitchens, bathrooms, windows, and lawn ornaments. Since the American dream is to own a home, HD's earnings and share price are great indicators of how things are going economically.
Obviously, things are "going" right now. The government's giant E-Z-Credit program has businesses and consumers floating on an ocean of cheap money. This has offset the dampening effects of the housing crash and high unemployment.
How will this all turn out? As we often remind folks, there ain't no such thing as a free lunch. Paying for all kinds of bailouts, clunkers, subsidized home loans, food stamps, sport wars, and welfare checks will eventually debase the paper dollar. But for now, Home Depot and its customers are riding comfortably on the Fed's gravy train.
Home Depot is one of our favorite "real world" indicator companies. As the country's largest home improvement chain, HD's stock rises and falls with America's ability to spend money on new flooring, kitchens, bathrooms, windows, and lawn ornaments. Since the American dream is to own a home, HD's earnings and share price are great indicators of how things are going economically.
Obviously, things are "going" right now. The government's giant E-Z-Credit program has businesses and consumers floating on an ocean of cheap money. This has offset the dampening effects of the housing crash and high unemployment.
How will this all turn out? As we often remind folks, there ain't no such thing as a free lunch. Paying for all kinds of bailouts, clunkers, subsidized home loans, food stamps, sport wars, and welfare checks will eventually debase the paper dollar. But for now, Home Depot and its customers are riding comfortably on the Fed's gravy train.
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