Obama and the Stock Market Crash
Mostly (but not completely) Yes. I hate following the stock market as a guide on what Government is doing right or wrong. These days especially, the market is so manipulated by heavy hitters, and so volatile, we really cannot point to Government (or Obama) as the root cause. On the other hand, Obama does share at least some of the blame here, if not most of it. Right now, the markets have rejected Stimulus as a big waste, are appalled by Obama’s budget spending and tax increases, revile Obama’s doom and gloom diagnosis (which he is using to justify his own agenda) of our financial future, deems rightfully that the Government is clueless in the face of this problem, and has concluded correctly again bailouts are not working so far (this is really everybody’s fault including Obama, Bush, Congress, and now Obama Treasury Secretary Geithner).
Today the Wall Street Journal addressed this, and blames Obama (see The Obama Economy 3/3/09). An excerpt:
The market has notably plunged since Mr. Obama introduced his budget last week, and that should be no surprise. The document was a declaration of hostility toward capitalists across the economy. Health-care stocks have dived on fears of new government mandates and price controls. Private lenders to students have been told they’re no longer wanted. Anyone who uses carbon energy has been warned to expect a huge tax increase from cap and trade. And every risk-taker and investor now knows that another tax increase will slam the economy in 2011, unless Mr. Obama lets Speaker Nancy Pelosi impose one even earlier.
Also, star political analyst Dick Morris predicted that this would happen under Obama as early as March 2008 in his book Fleeced:
Obama’s election will trigger a stock market crash and likely devastate the already slumping real estate industry. A selling psychology usually feeds upon itself and can often induce a market-wide panic. So the nearer Obama gets to power the faster the markets are likely to dip. So look for a sharp downturn as election day approaches, and especially in the period between the Democratic victory and Inauguration day. Obama will doubtless blame the drop on the outgoing Bush Administration, but it will be his own tax plans that send the markets into a tizzy.
Whether fully true, these arguments are damning to Obama.
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