There is no doubt McCain was terrible in his response to the economic crisis. But to think that Obama's campaign promises were the appropriate solution seems a little far fetched. He offered up an idea, if not specifically then implicitly throughout his campaign, that a more European style Government wrought with massive regulation would have prevented this from happening. Unfortunately, this hasn't prevented Europe from going through similar market unrest. And at the chore of this problem are two companies that were heavily monitored by the Government, Freddie and Fannie.
However, the idea of an Obama Discount is rooted in a cyclical pattern. Popular oppinion polls for Obama increased, and as they increased investor worries of Obama policies decreased the DOW, which in turn fueled more panic and support for something different. Even if the something different doesn't necessarily help.
But if this theory is correct or not is yet to be determined.
This thing is in a wild ride. I think the volatility of the last few days relates to the bad job and economic reports and to Hank Paulson monkeying around with TARP (clumbsy government interventionism- I have not been a fan of that thing since the beginning).
But the early drops I'm pretty convinced are at least partly Obama-related. Too many friends in the industry have told me they have people expressing fears of Obama's taxes to them in connection with selling stocks.
But I do agree the overarching economic collapse is still the primary driver of this volatility, as I express in my missive. And I agree that the collapse drove Obama up in the polls (McCain did not respond well to it).
Very interesting to debate though. And these charts are not going to look good for Mr. Obama in the long-term.
BWL - 18 years ago
You're confusing cause and effect, chum.
Obama's numbers went up because the Dow went down, not vice versa. As the economy has worsened and McCain (who, remember, admitted his inability in the area of economics) offered the same old solutions as the Bush League, is there any wonder that Obama became more popular?
When McCain claimed the economy's fundamentals were fine one morning and that we were in trouble that same afternoon, is there any wonder that he lost ground when things went south?
There is no doubt McCain was terrible in his response to the economic crisis. But to think that Obama's campaign promises were the appropriate solution seems a little far fetched. He offered up an idea, if not specifically then implicitly throughout his campaign, that a more European style Government wrought with massive regulation would have prevented this from happening. Unfortunately, this hasn't prevented Europe from going through similar market unrest. And at the chore of this problem are two companies that were heavily monitored by the Government, Freddie and Fannie.
However, the idea of an Obama Discount is rooted in a cyclical pattern. Popular oppinion polls for Obama increased, and as they increased investor worries of Obama policies decreased the DOW, which in turn fueled more panic and support for something different. Even if the something different doesn't necessarily help.
But if this theory is correct or not is yet to be determined.
Thanks for the post, BWL.
This thing is in a wild ride. I think the volatility of the last few days relates to the bad job and economic reports and to Hank Paulson monkeying around with TARP (clumbsy government interventionism- I have not been a fan of that thing since the beginning).
But the early drops I'm pretty convinced are at least partly Obama-related. Too many friends in the industry have told me they have people expressing fears of Obama's taxes to them in connection with selling stocks.
But I do agree the overarching economic collapse is still the primary driver of this volatility, as I express in my missive. And I agree that the collapse drove Obama up in the polls (McCain did not respond well to it).
Very interesting to debate though. And these charts are not going to look good for Mr. Obama in the long-term.
You're confusing cause and effect, chum.
Obama's numbers went up because the Dow went down, not vice versa. As the economy has worsened and McCain (who, remember, admitted his inability in the area of economics) offered the same old solutions as the Bush League, is there any wonder that Obama became more popular?
When McCain claimed the economy's fundamentals were fine one morning and that we were in trouble that same afternoon, is there any wonder that he lost ground when things went south?