An Uneasy System; Stocks Are on the Rise Even as the Economy Loses Steam
Correction: An Oct. 7 Business article incorrectly said that the Commerce Department produced the September employment report. The report came from the Labor Department. (Published 10/11/2007)</br></br>The economy is slowing, the dollar is falling. Wall Street is laying off workers. Defaults by homeowners are rising. Corporate buyouts have lost momentum.</br></br>But none of it has rattled stock market investors. Just weeks after the shock of the summer credit squeeze, they are shaking off one bad report after another, sending shares ever higher. Call them the Teflon investors.</br></br>On Monday, the Dow Jones industrial average of 30 blue-chip stocks soared to a new high, even as two major investment banks announced that they lost billions of dollars in the credit market turmoil. Then a positive jobs report Friday gave investors an excuse to buy, and the Standard & Poor's 500-stock index, a broader market measure, surged to a record. But even as investors celebrate, the questions hovering over the economy's future are far from settled.</br></br>If you're scratching your head about the seeming disconnect between stocks and the economy, you're not alone. The stock market, after all, is supposed to be a leading indicator of economic performance.