Robert Reich:
You’ll be hearing that the stock market is rebounding because the U.S. economy is "showing signs of strength" (see article below, for example).
Baloney.
The stock market is rebounding because:
1. Investors have nowhere to put their money except stocks, because interest rates remain at historic lows and the Fed is unlikely to raise them any time soon.
2. Global investors and savers have almost nowhere to put their money but into the United States since Europe’s outlook is bleak, Japan is still a basket case, Britain is in shambles, China is a giant question mark, and the rest of the world is limping along on two cylinders.
3. Corporations are borrowing even more money at rock-bottom interest rates to buy back their own shares of stock, thereby raising stock prices artificially.
4. Corporate earnings are rising because companies are pushing wages even further down, shifting work from employees to subcontractors, and outsourcing jobs abroad (where, because the dollar is rising relative to foreign currencies, labor is even cheaper than before).
Bottom line: The rich (who own most shares of stock) are doing better than ever, while average working Americans are going nowhere.