Massive Layoffs Help Corporate Profits, Stock Market, Soar

ATLANTA, Ga. -- The last time the Dow passed the 10,000 mark, it was on its way down.

On Wednesday it was at 10,000 again, climbing above 10,000 after a seven-month surge that effectively brought stocks to a break-even point for the past ten years.

For all those still searching for a job, or trying to sell a house, or qualify for a loan, what happened Wednesday on Wall Street won't get them what they want right away. But stocks going up is better than stocks going down.

"In terms of what it means for the economy," said Tom Smith, Professor of Finance at Emory University's Goizueta Business School, "I don't know if it has any real significance. It certainly doesn't mean that we're out of the recession. But it is a good indicator that things are moving in the right direction."

Smith said what just happened on Wall Street is like in a football game when the running back makes a great run and scores, but the team is still two touchdowns behind.

"It's a good thing for your halfback if he runs a hundred yards, but if your team is down by two touchdowns, it still means you're losing, right? So the Dow's hit 10,000. It's a good marker for the economy... it's a good marker for people to get a sense about things are moving in the right direction. But at the end of the day, if you really want to keep score, you have to look at the score. And we're still down."

There are other signs of new life in the economy. Retail sales are up slightly, 0.5 percent -- excluding auto sales, that is. And Michelle Girard, RBS Senior Economist, said on CNBC Wednesday she is hopeful about that.

"It isn't much, it's baby steps, but there is some evidence that the household sector, and demand in the household sector, is stirring a bit."

Still, one reason corporate America is doing better on Wall Street -- they've drastically reduced overhead and they're keeping more of their money.

"They have cut really deep and really hard in their labor expenses." Smith said. "They've laid off a lot of people.... So they're really cutting expenses where it was hurting them the most, but that translates into really high unemployment rates."

And employment is always the last segment of the economy to recover.

The stock market, Smith said, is one of the first.