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BUSINESS A25
Monday 15 February 2016
Main Street holds up as Wall Street struggles, for a change
STAN CHOE continue, but only up to a mists say that just balances In this Feb. 1, 2016, file photo, specialist Michael Gagliano, fore-
AP Business Writer point. If profits fall sharply out the big surge in hiring ground, works with traders at his post on the floor of the New
NEW YORK (AP) — Wall enough, for example, it at the end of last year, York Stock Exchange.
Street is hurting, and Main could push CEOs to once and they’re still forecasting
Street doesn’t care. It’s got again cut swaths of jobs more gains. Associated Press
burgers and cars to buy. in order to shore up their Even more importantly,
Big losses in stock markets earnings. If stock prices fall wages are trending higher.
around the world this year deep enough, the panic in That means workers are
have the wingtip-set fret- the headlines could trau- feeling more secure in their
ting, but regular consum- matize consumers whether jobs and in their finances.
ers across the United States or not they have a 401(k), Just over 3 million workers
are confident enough to and spending could slow. quit their jobs in December,
open their wallets and For now, though, Main the highest number in near-
spend more. It’s an about- Street continues to trend ly a decade. That’s an opti-
face from the early years upward. Only 13 percent mistic sign because people
of the economic recovery, of the U.S. economy de- generally quit when they
which began in 2009, when pends on exports, and the have a higher-paying job
stocks and big banks were rest of it — which is mostly offer in hand.
soaring but many on Main consumer spending — is still — Bills are getting a bit eas-
Street felt like they were growing, albeit slowly. ier to pay.
getting left behind. “Down here, as a small busi- The plunging prices of gas-
“It’s almost like a stock mar- ness owner, you don’t feel oline, natural gas, heating
ket is a different animal,” connected to Wall Street oil and other commodi-
says Earl Stewart, who owns at all,” says Jon Sears, a co- ties are getting lots of at-
a Toyota dealership in owner of four bars and res- tention, but prices are low
North Palm Beach, Florida, taurants in Columbia, South across the economy. Prices
far from the roiling markets Carolina. “When I talk to for meat, poultry, fish and
in New York, Frankfurt and people in Columbia, I can’t eggs also fell in December
Shanghai. “We’re not see- think of a conversation I’ve from a year earlier. So did
ing any of the negativity.” had about the stock mar- prices for clothes and air-
The stock market’s malaise ket in the past two or three fares.
hasn’t affected his custom- weeks.”
ers, at least not yet. Sales His business depends in- There is a fear that the
for the past year have stead on the nearby Uni- economy may get too
been the best since 2007, versity of South Carolina. much of a good thing. If
and he had record profits Revenue growth at his lo- prices fall too sharply, it
in 2015. cations has held up this could lead to a vicious cy-
The divergence underway year, at his cheapest bar cle in which customers wait
between Main Street and and his more upscale res- longer to make purchases,
Wall Street highlights the taurant that serves local, which forces businesses to
difference between the organic foods. cut jobs.
U.S. stock market and the Retailers around the coun- — Home values are rising.
economy. The stock mar- try are seeing something “More people care still
ket’s worries are centered similar. Shoppers bought care about the value of
on things like the strength more autos, clothes and their homes than the value
of foreign economies, such other items last month, even of their stocks,” says Diane
as how much China’s sharp though the S&P 500 in that Swonk, an independent
slowdown will hurt export- span had its worst week in economist.
ers and businesses in other more than four years. U.S. That’s because for many
countries. Low oil prices are retail sales rose 0.2 percent Americans, their home is
crushing the shares of big during the month, beating their biggest if not only in-
energy companies and the analyst expectations. vestment. And that invest-
big banks that lend to them Consumer sentiment did ment is doing well, regard-
— but leaving consumers show a dip in early Febru- less of the stock market’s
with more money to spend ary. But confidence still re- struggles. Home prices na-
after they fill up their car mains near its average for tionwide are nearly back
with cheap gasoline. last year and well above to peak levels from before
These forces have dragged where it was for every other the Great Recession, and
the Standard & Poor’s year of the recent bull mar- they’re already at a record
500 index down 12.5 per- ket. in San Francisco and sev-
cent from its peak in May. Among the reasons that eral other cities.
Foreign stocks have lost Main Street is feeling rela- It may just be Main Street’s
double that. Hedge funds, tively confident while Wall time in the sun, says Bob
which cater to the wealthi- Street stumbles: Doll, chief equity strategist
est and biggest investors, — The job market is getting at Nuveen Asset Manage-
are also struggling. They lost better. ment. He says economic
money in January and got Employers continue to add recoveries have long been
off to their worst start of a jobs, particularly in the re- split into two phases.
year since 2008, according tail and health care indus- “The first half of an eco-
to Hedge Fund Research. tries, and the unemploy- nomic cycle is when mar-
Economists say the split ment rate is at an eight- kets tend to best, and that’s
trends between Main year low. Job growth did when Wall Street gains on
Street and Wall Street can slow last month, but econo- Main Street,” Doll says. q
