Hello guys, I saw this post and it gave me questions: how can the S&P 500 keep growing to historical highs when we are not putting more people into the economy to spend? This is counterproductive; it doesn't make sense. I saw a video saying we are now in a financialization phase, which means you get richer investing in the stock market than creating real value and means for society. Maybe this will explain this graph. Please give your opinions because the world seems to be changing a lot.

https://i.redd.it/5m5xhp90z1zf1.jpeg

by 2pac4lif2

22 comments

  1. Its AI, but its also residual cash from the QE looking for a place to escape inflation….I think the latter is 90% of the increase…people completely underestimating what 2.5% debt and a tidal wave of liquidity did to the economy and stock market.

  2. The stock market isn’t even doing well, gains are EXTREMELY concentrated. Essentially the rich are a separate economy from the poor and they have all the money so they’re assets can stay up even while the economy is shit.

  3. So job openings started dropping even before ChatGPT was launched?!

  5. Technically US market should be in recession. AI bubble creating distortions that will eventually burst.

  6. I dont even know if this chart is true, for how often I’ve seen it….

    I dont think its impossible for SP500 to do well without job openings, but its more concerning we’re doing layoffs to increase short term gain.
    That is whats happening!

    Ultimately, how long can companies generate value and revenue by themselves, it probably depends on the industry.

  9. I have been told that AI is definitely not impacting jobs and that no AI can do the job of a human.

    So this definitely isn’t AI.

  10. That chart is pure fiction and OP should be banned for economic illiteracy. At least for a year to give them time to learn.

    If you learn literally the first thing about economics, you realize that the sp 500 is supposed to continually grow at an exponential rate, whereas job openings are relatively flat with a bit of growth due to population growth.

  11. Just one more chart proving the stock market has ZERO connection to the general economy EXCEPT when it crashes and precipitates a global crisis. Even then it only impacts the bottom 90%.

  12. AI is an excuse. I don’t really buy that it’s killing that many jobs yet. Just a convenient cover up to lower headcounts.

  15. Speculation over AI is driving tech stocks to ATHs while balance sheet for durable / consumer goods companies is weighed down by tariffs. Companies are jettisoning employees and concentrating R&D efforts to recover margin.

    Companies with strong revenue beats are still getting hammered on lack luster margin growth and return on capital during investor calls. Even the larger tech companies who have been insulated the past few quarters are starting to get challenged on runaway AI investment.

  16. During the previous industrial revolutions, did no industry increase profits while decreasing staff? Farms have very high yields per person compared to 1300.

    People can spend without a job. It’s called retirement or welfare. Also, if wages are increasing for the top 40% and they tend to do the spending that drives the S and P, that Starbucks is not hiring dosn’t affect it in a negative manner. If the unemployment rate is relatively constant, fewer job openings don’t necessarily mean less spending power.

    When was working construction a better way to get rich than the stock market? 60 hr weeks are a grind, at 10% 400hrs in the stock market more easily gets you 40 than swinging a hammer. After (a good) 10 years, a frugal young man with 6000 hrs in the stock market can make as much as someone working 50 hrs working 42 hours a week. If he focuses just on accumulating wealth, he could build it up to where he has 50k hrs in the stock market and have a pension paying 2000 hours a year with 0 new work.

    60-hour weeks at 60 seems like something to avoid.

  17. I think companies been making more money by inflating stocks than producing goods for a while now.

    Stock buybacks woo.

  18. I’m crushing it in the market but feel that we are headed towards MAJOR correction

  19. I think everyone that’s working with AI knows that it can’t replace jobs. It can replace some simplistic tasks. However most companies have already reduced the workforce.

    There’s one big problem currently, less demand + oversupply is causing an economic downturn.

  20. Without labels on the other axis, this is a very difficult chart to assess.

  22. As the saying goes, correlation does not imply causation.

    From March 2020 to February 2022, the US had 0.25% interest rate. Companies were hiring people like crazy during COVID. From March 2022 and up to July 2023, fed raised the interest rate from 0.25% to 5.5%, the 5.5% rate lasted for over a year, until August 2024.

    This could imply that companies overhired (see the massive spike form when COVID started) due to free money.

    So now companies had too many employees, and obviously didn’t need to hire more. Then when free cash dried up, they had to start laying off people..

    Meanwhile the AI boom is carrying the stock market, with astronomical stock prices for companies in that sector.

    But the lesson here is that you should not look at a simple chart and draw conclusions on that alone…as I said, correlation does not imply causation.

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