Dow reaches new marketplace high
The Dow Jones Industrial Average reached a record high as it closed Tuesday March 5. The score was 14253.77, marking a 125.95 increase over Monday's closing.
"I think it's going to cause individuals to look," Steven Beech said, an adviser at Edward Jones in Red Wing. "And I think there's going to be some excitement about that."
While the economy looks differently than it did in 2009 when there was stress on the credit system, "markets have gone up and historically markets have corrected," Beech said. One reason is U.S. Treasury implemented Troubled Asset Relief Program designed to stabilize the U.S. financial system, prompt growth and prevent avoidable foreclosures.
"What's happened is the TARP program has been put in place and the credit markets began to stabilize," Beech said.
Another reason he said he thinks correction occurred was because people have had the confidence to invest in the market through stocks and by making purchases.
The numbers reflect this confidence. On March 9, 2012, the Dow stood at almost 13,000 points. A year before that in September, the market was 10,771.48.
Even though the Dow Jones reflects an improving economy, Beech said the "biggest challenge is where the unemployment rate is at" -- nearly 8 percent.
Once there more people have money attained through working, then consumerism will go up, and the economy will follow, Beech predicted.
"That will definitely help the economy," he said.
Beech said he recommends that people not get too excited about the Dow's record closing, because while there have been improvements, historically corrections in the market do exist.