Stocks today followed yesterday’s late afternoon sell-off with another down day. Yesterday, the market was taken down by news that the ratings agency Fitch said U.S. banks have a lot of exposure to the problems in Europe. If you're thinking, "Really? That's all it took?", you're not alone.
We spoke with Barry Bosworth, a senior fellow at the Brookings Institution. He says ratings agencies like Fitch are just not the place to look for insights into big economic issues. When it comes to the big topics, like the eurozone crisis, those issues are hashed out on a much more public stage; just pick up a paper or turn on your TV and you can find out what’s happening in Frankfurt or Rome.
The markets were buoyed a bit in the morning on news that the latest weekly jobless claims fell to the lowest level since April. Bosworth says the best way to look at weekly jobless claims is to average them over several weeks. And when you do that, the news today was reassuring. It's another sign that concerns about a double dip recession in the summer were overblown and reminds us that while our economy is not performing well right now, it is resilient.
Still, Bosworth says it's worth asking whether the decline in jobless claims comes in part because some people have just been out of work so long they're no longer eligible for benefits. When people are out of work too long, they lose their skills and unemployment becomes a structural problem. Bosworth says he's not sure we're there yet. We have a labor market that's very good at creating jobs, but there are just not a lot of jobs out there right now.
Also on the show today, there's news that Americans are skeptical about their prospects for a comfortable retirement. Three-quarters of people polled in a Wells Fargo survey said they expect to work in their retirement years. One quarter said they don't expect to be able to retire until they're 80 years old.
The big issue: Savings, right? Not enough of it, means people cut back on spending, which can slow the economy needs. It slows down our Marketplace Daily Pulse today.