Economic Woes Continue

The Dow is down 15.4% this year, 20.8% below its October record high and, as of Wednesday, officially in its first bear market in almost six years. The 50% spurt in oil this year to a record $143.57 a barrel has deepened the economic gloom in the USA and delayed an expected recovery. Increasingly, as oil goes, so goes the stock market. If oil shoots up to $170 a barrel this summer, as OPEC warned, or hits the $200 target of investment bank Goldman Sachs, stocks are in for a rough ride. The Dow is already near a two-year low.

Employers cut payrolls by 62,000 in June, the sixth month of nationwide job losses, underscoring the economy's fragile state. The unemployment rate held steady at 5.5%. The Labor Department's report Thursday showed continued caution on the part of employers who are chafing under zooming energy prices and are uncertain about how long the economy will be stuck in a sluggish mode, reflecting fallout from housing, credit and financial troubles. So far this year, the economy has lost a total of 438,00 jobs, an average of 73,000 a month.