Economic
The Stock Market Is Not the Economy
February 22, 2026
AI Summary / TL;DR
It's interesting—and also kind of sad—to see the President of the United States, the most powerful man in the world, still focusing so heavily on the stock market. There are many ways to measure the health of an economy.
It's interesting—and also kind of sad—to see the President of the United States, the most powerful man in the world, still focusing so heavily on the stock market.
There are many ways to measure the health of an economy. You can look at the unemployment rate, job creation, inflation, wage growth, productivity, and cost of living. The president will mention some of these things sometimes, including inflation. But the statistic he seems to rely on the most—again and again—is the stock market.
More specifically, he focuses on the major indexes. He'll talk about the Dow Jones going from 5,000 to 50,000, or the S&P 500 hitting record highs, or the market being "at an all-time high." And the way he talks about it makes it sound like the stock market is the economy.
But the reality is that a lot of Americans don't even own stocks. Many people aren't investing at all. And even if you include people who only have exposure through retirement accounts like a 401(k) or TSP, the number of Americans who truly benefit from the stock market is still limited. That's why measuring the entire US economy through the Dow Jones or the S&P 500 is not an accurate way to describe how most people are doing.
It also makes it harder for us to see the real picture. We are living in a K-shaped economy, where the wealthy are doing well and propping up a lot of consumer spending. Meanwhile, regular Americans—the middle class, the working class, and lower-income people—are feeling squeezed.
If you only look at the stock market, you can say the economy is doing great. But outside of the stock market, a lot of things are not doing that great. Bitcoin isn't doing that great. A lot of other indicators don't look as strong either. And the underlying problems are still there.
So it's striking to see the president "pitch" the indexes as proof that everything is fine, instead of focusing more on other economic indicators that reflect everyday life. And when leaders focus so much on the stock market, it can shape economic policy in a way that revolves around protecting markets and indexes.
Is that good or bad? We'll have to see. But overall, what we're seeing right now is that the middle class and lower-income people are not having a very fun time.
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