The Dow Jones Industrial Average hit an all-time high on Tuesday.
But you wouldn't know that if you watched MSNBC's Hardball where two guests actually made the case that this really isn't an all-time high due to inflation (video follows with transcribed highlights and commentary):
After substitute host Michael Smerconish reported the news most Americans with money in the markets are pleased with, MSNBC policy analyst Ezra Klein was quite sour saying, "The Dow Jones is a little bit weird in that it doesn't adjust for inflation which is how we would always do a calculation like this. So if you do adjust for inflation, which you do need to do to see real value here, the Dow is at a lower point than it was in '09; it is at a lower point than it was in 2000."
As many of you know, I cut my teeth working on the Pacific Stock Exchange in San Francisco as an arbitrageur for Merrill Lynch, and when a stock index hit an all-time high, it was an all-time high.
This is what an all-time high looks like:
More importantly, stock indices aren't adjusted for inflation and never have been.
I guess Klein who majored in political science at UCLA isn't aware of that, nor was he accurate in stating that the Dow was higher adjusted for inflation in 2009.
He clearly meant 2007 when the Dow hit its most recent high until today.
Again, what should we expect from a poli-sci major?
But even more absurd, Klein later said, "We are not on such a rip-roaring good stock market run here."
Really? The Dow has now more than doubled from its March 2009 low. If that's not rip-roaring good, what is?
Is it possible there's some political reason Klein wanted viewers to think this wasn't such great news?
Our answer came from the substitute host who said once Klein finished, "Doesn't it undercut the arguments politically speaking that have been made about sequester? I mean, Wall Street apparently has a big harumph as a reaction to the sequester"
Getting the point now?
Cue Politico's chief economic correspondent Ben White who said, "It does to a degree."
"In terms of their arguments for the sequester and the impact they said it would have on the economy, that they said it would have on people's lives, you know, a Dow at record highs is not very good for that intellectual argument," White observed. "It doesn't feel to people that the sequester is hitting very hard if the Dow and other stocks are rocketing to new highs."
If you weren't getting the point before, are you getting it now? If so, what do you think White said next?
"But Ezra's absolutely right," he predictably equivocated. "I mean, we're not, we shouldn't be putting on our Dow 36,000 hats any time soon. We're not at an inflation-adjusted level where we were in 2000."
Isn't that amazing?
If this were last year, MSNBC would have been celebrating the Dow's high with champagne to try to help Obama get re-elected.
But now their game is to downplay good economic news so that the President's claim of sequester-related gloom and doom would appear to be correct.
As such, it seems likely the shills at MSNBC are actually going to be cheering for a weaker economy in the coming months.
Exactly how do these folks look themselves in the mirror each morning when they shave and brush their teeth?
Stock charts courtesy Bigcharts.com.