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Sen. Charles Schumer watches as Alcoa CEO Klaus Kleinfeld addresses his employees in Massena in 2011.
Sen. Charles Schumer watches as Alcoa CEO Klaus Kleinfeld addresses his employees in Massena in 2011.

Should we care about Alcoa's Dow Jones demotion?

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This week the Dow Jones industrial average announced it will drop Alcoa and two other companies from its roster, replacing them with Nike, Visa, and Goldman Sachs. It's the biggest change to the 30-firm roster in nine years.

The New York Times called Alcoa's exclusion "a symbolic comedown." And it sure seems like it - clunky old aluminum out, Michael Jordan and "the swoosh" in.

One North Country financial planner told us it was "a sad day for the North Country". Alcoa practically built Massena, and remains northern New York's largest private sector employer. About 1000 people work there now.

But does the slight from the vaunted Dow Jones really matter?

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Reported by

David Sommerstein
Reporter/ Producer

In a word, Peter FitzRandolph says - no. He studies Wall Street and the stock market as an economics professor at St. Lawrence University.

FitzRandolph says the Dow Jones is overrated an economic indicator. "The Dow Jones average is a terrible average," says FitzRandolph. "Nobody in the field of economics or even in the field of investments or finance pay any attention to it whatsoever."

FitzRandolph says the toughest thing for Alcoa is how to explain the exclusion to the world. "It will be difficult for the company, in some ways, to put out the news to that average person out there that it doesn't make a difference," he says. "But, in fact, the company is absolutely correct. It should have no impact on them whatsoever, and it shouldn't be viewed as a negative."

In a statement, Alcoa said the exclusion from the index will have no impact on its strategy. "We are focused on the things we can control," the aluminum giant said.

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