Liz Peek: Stock Market Gives Obama’s First Month An 'F'

[alienlovechild 75]

"Today marks the one-month anniversary of President Obama’s inauguration. In his brief time in office, the president has overseen three massive new spending initiatives — the $787 billion stimulus bill, the trillion-dollar financial stability initiative and, most recently, the $275 billion mortgage assistance program.

That’s a lot of activity, and a ton of money, but so far the reaction to the new administration’s programs has been decidedly negative. Investors, among others, have panned the plans; the stock market is off nearly 10% from the day before the inauguration, or more than 800 points on the Dow Jones Industrial Average.

Yesterday, in fact, we crossed a truly alarming divide. The Dow Jones average closed at its lowest point since October 2002, the bottom of the last bear market. The S&P 500 fell to 779, barely above the intra-day low of 741 of last November. For many market analysts, if the market crashes through that recent benchmark, it will next move significantly lower. Ouch.

What is going to turn this beast around, and what should the president do? First of all, let’s dispense with the antiquated notion that only rich people own stocks, and that the market’s ups and downs are unimportant. Almost everyone has a stake in our financial markets, either through owning stocks and bonds directly or through pension plans. Even the neediest Americans who are fed or clothed by charities are hurt when those organizations’ endowments crater or donations dry up.

Clearly, it is way too early for any of the new stabilization and stimulus programs to have taken effect. Why then is the consensus so pessimistic? Certainly the political wrangling of the past month has dispelled optimism that President Obama can change the contentious nature of American politics. Both Democrats and Republicans have spurned Obama’s leadership. The free-for-all over the stimulus bill portrayed Congress in the worst possible light — no surprise there — and led Americans to view not only the process but the bill with utter skepticism. Delivering a 1000-page bill to our legislators just two hours before the signing deadline (and then going on a long-weekend holiday before signing it) was outrageous. The mortgage relief plan hasn’t been received much better. Most Americans (ninety two percent, by some estimates) pay their mortgages on time; they’re darned if they know why they should bail out their neighbors.

Over the realistic objections of the National Economic Council’s Larry Summers and Treasury Secretary Timothy Geithner, it is said that Chief of Staff Rahm Emmanuel encouraged Senator Chris Dodd to, at the last minute, attach a punitive pay cap on Wall Street execs into the stimulus bill. This tug of war may also account for the gaping holes in the financial bill delivered with child-like upspeak by Geithner, and similar inadequacies in the new mortgage plan. The housing program stupidly omits an obvious need to insulate mortgage servicers from legal claims that they abridged mortgage-holders rights. Because so many mortgages were packaged and sold off to investors, immunity from lawsuits is a necessity if we want servicers to change mortgage terms.

http://www.wowowow.com/post/liz-peek-barac...stimulus-214454

[spookyturtle 9,466]

Investors are quite fickle, IMHO. The market goes down due to stimulus, the market goes down due to the lack of a stimulus. The market was sky high when it was built on a house of cards. Where is the logic? Gas use is high, oil goes up, gas goes up. Gas use goes down, oil goes down, gas is going up again.

[alienlovechild 75]

Investors are quite fickle, IMHO. The market goes down due to stimulus, the market goes down due to the lack of a stimulus. The market was sky high when it was built on a house of cards. Where is the logic? Gas use is high, oil goes up, gas goes up. Gas use goes down, oil goes down, gas is going up again.

Don't sweat it. There are few investment gurus who are frequent posters here and claiming to have all the answers. Don't hold your breath waiting for a clear answer.

[spookyturtle 9,466]

Investors are quite fickle, IMHO. The market goes down due to stimulus, the market goes down due to the lack of a stimulus. The market was sky high when it was built on a house of cards. Where is the logic? Gas use is high, oil goes up, gas goes up. Gas use goes down, oil goes down, gas is going up again.

Don't sweat it. There are few investment gurus who are frequent posters here and claiming to have all the answers. Don't hold your breath waiting for a clear answer.

Isn't it ironic that no matter what the situation, everyone has the answers, except those that are actually in control and could do something about it. Why does the President need advisors, he should just come to off topic and all of our problems would be solved.

[tallcoolone 102]

I think Obama is in way over his head being President.

All the "Hope and Change" talk has seemed to be quiet now

The economy and the hopes of the USA is in his lap, and he seems to be curling up into the fetal position.

I just hope we get past these 4 years and have 2 better choice to vote for for President in 2012.

In my opinon Obama and McCain both were poor choice for the American public to choose from....

[Jasman0717 9]

Or maybe Obama is giving the criminal element notice to get out

[Ban Hammer 13,352]

I think Obama is in way over his head being President.

All the "Hope and Change" talk has seemed to be quiet now

The economy and the hopes of the USA is in his lap, and he seems to be curling up into the fetal position.

I just hope we get past these 4 years and have 2 better choice to vote for for President in 2012.

In my opinon Obama and McCain both were poor choice for the American public to choose from....

agreed on all points