Stock exchange not only indicator of economy
Wall Street is breaking out the party hats — the Dow 15,000 party hats, that is.
The stock market has been on a tear lately, culminating in the Dow Jones Industrial Average closing above 15,000 for the first time ever Tuesday.
This is cause for either celebration or concern, depending on whether you're a bull or a bear.
On Wednesday, the Wall Street Journal highlighted just how quickly the Dow's meteoric rise has occurred.
It took just 64 trading days for the market to go from 14,000 to 15,000, the Journal reported, making it one of the fastest thousand-point runs in the index's history.
In fact, the market hasn't had a three-day losing streak in 87 trading days — the longest such streak since 1958.
To put this in perspective, during the "irrational exuberance" of the late 1990s, it took the Dow 104 trading days to go from 7,000 to 8,000, another 181 days to make it to 9,000, 245 days — and a brief bear market — to break 10,000 before taking just 23 days to surge to the 11,000 mark.
Of course, then the bubble burst and it took the market about seven years to start hitting new highs again.
But as Wall Street surges, it's interesting to take a look at how the local economy is doing in comparison.
When the Dow last peaked at 14,164.53 on Oct. 9, 2007, West Virginia's unemployment rate was 4.3 percent. When it hit its dot-com bubble peak of 11,722.98 on Jan. 14, 2000, state unemployment stood at 5.7 percent.
As the Dow blows through uncharted territory today, West Virginia's unemployment rate stands at 7 percent. And that's lower than the national rate of 7.5 percent.
Obviously Main Street hasn't caught the momentum of Wall Street. Guess it will be a while before we all can party like it's 1999.
Meanwhile, a new survey from Pew Charitable Trusts found that West Virginia would be the least-affected state if Congress and President Barack Obama chose to eliminate the mortgage interest deduction.
Pew found that only 15 percent of state taxpayers claim the deduction, with an average deduction of $1,220 per filer. West Virginia had the fewest taxpayers using the deduction, and only North Dakota, at $1,192, had a lower average claim.
The study found 25.5 percent of taxpayers across the country are using the deduction.
The use of the deduction varies widely among states. It is used more frequently by those in metropolitan areas, where home values have increased significantly and there is a high turnover rate for home ownership.
At 36.8 percent, Maryland had the highest percentage of taxpayers who used the deduction, followed by Connecticut at 34.3 percent and Virginia at 33.2 percent. The average deduction taken in Maryland was $4,580 per filer.