Obama Killing The Stock Market
Many, many parties are beginning to notice the link between this administrations economic strategies and the tanking of the stock market. This article mentions what I'd estimate to be 150 news articles from yesterday.
Tim do you still think this is not fair?.
President Obama has responded saying that basing policy on the stock market will lead to bad policy ... in other words acknowledging that his policy is scaring investors.
Obama also compared the stock market to the popularity contest that is poll tracking. This is an incredibly big stretch. When you vote for prom king, you have no skin in the game. When you invest your money, you are voting with your own skin.
In case you are wondering what policy exactly is scary investors, it's his tax plan to attack the "rich" (i.e. people who donate to charities). Centrists and even democrats are raising objections. Meanwhile, the Democrats are boasting that they are not Rush Limbaugh.
Also, see Lucy's post.
Tim do you still think this is not fair?.
President Obama has responded saying that basing policy on the stock market will lead to bad policy ... in other words acknowledging that his policy is scaring investors.
Obama also compared the stock market to the popularity contest that is poll tracking. This is an incredibly big stretch. When you vote for prom king, you have no skin in the game. When you invest your money, you are voting with your own skin.
In case you are wondering what policy exactly is scary investors, it's his tax plan to attack the "rich" (i.e. people who donate to charities). Centrists and even democrats are raising objections. Meanwhile, the Democrats are boasting that they are not Rush Limbaugh.
Also, see Lucy's post.
posted by Matthew Canonicus at
5:12 PM
13 Comments:
Matthew, it is frustrating to hear that people don't understand the ramifications of attacking business and the wealthy. Everyone hates the trickle down effect but they are beginning to feel it.
I repeat the rich will get through this. As you probably have figured out my husband is either a tax lawyer or CPA (he prefers I keep him anonymous.) The middle class and the poor will continue to suffer. It is sad to watch. The little things are already happening.
My cleaning lady said they are losing all of their "middle class" homes because people are losing their jobs and she is afraid she won't be working much longer.
My 'waxing technician' is losing customers, her words "left and right".
People may be going back to the basics but they are putting other people out of work in the process, trickle down. Restaurants that use to be packed, you walk right in. Meaning, cooks, waiters, bussers, mananger, etc.. you get the point are losing their jobs.
The government cannot bankroll (the rich taxes cannot cover everything, sorry to say) them forever.
Our kids cannot stay in school forever. Getting higher and higher degrees that will yield them no return because business owners will not invest in this country anymore. Bottom line, Americans need business owners to trust in the market and be willing to hire again. Americans need the private sector more than they want to admit.
I ask again, "Is the change we were looking for?"
I think it is high time our Politicians start promoting business again.
Maybe, Obama should encourage Profit.
Profit means a company will hire, so the government doesn't have to pay for you not to work.
And really most Americans I know want to work. They enjoy working. In addition, last time I checked most companies pay more than the government, not all but most.
You aren't proving causation. I could show you a graph where the number of UFO sightings is positively correlated to the number of posts you make on Conservative Earnest in a day. But it doesn't necessarily follow that your posts are causing UFO sightings!
I think a much simpler explanation of the falling stock market is the recession. Obama didn't cause the recession, and if anything the stock market's spirits should be brightened with a large economic stimulus package. The stock market is such an irrational and paranoid economic agent politicians should never base policy on it. It's fluctuations are based entirely on fear, panic, and mob mentality. It's a terrible economic institution that should not be given the amount of attention it currently does. The stock market is even overtaking the unemployment rate in conventional thought as a signal for a bad economical climate. What do we care more about, mostly wealthy people having a hard time with their stocks, or lower-middle class people losing their only source of income?
Timothy, whether we like it or not we have to care about both because as human beings we rely on each other.
Fear drives what people do. Politicians know this, do not kid yourself. It is how they get a lot of legislation passed. Therefore, the wealthy are becoming afraid of the economic situation and many are business owners too. They also contribute to charities. Unfortunately this affects the middle class and the poor. Many in The middle class will lose their hard earned jobs and the poor will lose their charity assistance.
If the politicians are going to use the dire straights of the economic situation to get the legislation that they want passed they better also figure out a way to get people trusting in the market or economy use whatever word you want. This way people won't lose their jobs and the poor can continue to receive the charity they need.
As a soceity we all go hand in hand. I believe when you start pitting classes against each other things get very nasty.
Yes, it would be a wonderful world if there were no classes and wouldn't we all like that dream world but I'm a realist, so I prefer to encourage working together than pitting classes against each other.
Hi Tim,
Thanks again for stopping by.
Causation *by definition* can never be proven. Hume demonstrated that. It could all be a coincidence that the stocks drop every time Geithner opens his mouth. If you want to say the stocks are irrational and mean nothing, I could easily say Bush was a great president but the irrational stocks failed to reflect his greatness. Bush could have hired Obama to come up and say, "Well folks, the stocks don't really say anything so don't hold this against me."
Bush threw money at the problem and so did Obama ... and they both worsened the problem in a very obvious way. The reason why the unemployment rate is less important than the stocks is because the more scared investors get (by government plundering its people) the less people they believe they will be able to afford employing. In other words the employment rate is a byproduct of the economy and not the other way around.
Hi Lucy,
I'm not trying to pit classes against each other (im not Jesus!), but Governments need to have correct priorities on how they spend their money. Which is a principle i'm sure we'd all agree on. The difference between us probably lies in what the priority should be.
Should they work on lowering capital gains tax, corporation tax, and business regulation in order to encourage wealthy people to invest in stocks and enterprise, hoping that the wealth will 'trickle down' as people get employed by these wealthy businessmen and companies. Or should the Government work on providing everybody a minimum standard of life, a minimum education, and society a good amount of public good infastructure. Of course i'm going to say the latter, but not just for moralistic reasons. The latter is better for economic growth in the long run, in my opinion.
Yes, wealthy people and business sometimes donate to charities (for every 1 Bill Gates there's 1000 scrooges), but wouldn't it be even better if there was no need in this world for charities in the first place? So long as a class of "super-rich" exist in societies, there will always be poverty.
Lastly, I really don't accept the argument that in order for the poor to be well-treated the wealthy need their fears to subside and for Government to enact policies to strenghten the stock market. Do you really suppose that anybody living below the poverty line in America is hoping that the Government will finally help out the rich people? ;)
Hey Matt,
No need to thank me, this is my alternative to enrolling into the debate society at university!
I know causation can never be proven. I remember how excited I was the first time I learnt Hume's critique of causation. It's indeed true that confidence in economies all around the world are very low at the moment, but I really don't see how any of it is Obama's fault. Stocks will fluctuate according to what politicians say at times, but it really shouldn't mean anything because most of it is to do with the irrational emotions of panic and exaggerated enthusiasm (isn't it ironic how our economy is structured around the two most unstable emotions of humanity!). Economically speaking, it isn't the short-term fluctuations but the long-term trends that make the stocket market relevant for economic analysis. With what you said about the unemployment rate, I think you misunderstood what I meant. The unemployment rate is a signal to what is happening in the economy, just as the stock exchange can be. My point was the link between the stock exchange and the economy is far more unpredictable and misleading than the more robust economical statistics (i.e. GDP, unemployment rate, inflation rate, etc. etc. etc.).
By the way, I've never ever said the reason that Bush was a terrible president was because of the behaviour of the stock market. You can easily say "Bush was a great president but the irrational stocks failed to reflect his greatness.", but just remember there may have been other reasons that people did not like Bush!
Timothy,
Yes, we do disagree on the Governments priorities.
I just don't believe in big government. I don't believe that Government jobs are the best way of insuring people with a living.
I believe that creating jobs in the Private Sector brings long term job security.
I do believe Americans want to work and they want job stability. I think this is created by the Private Sector, you think it should be created by the Government.
I don't think the Government should put 650,000 people to work and according to you they all need free healthcare and 'fair pay'. This is going to cost somebody a lot of money. Who would pay for all of this?
I will be honest I have re-wrote this comment several times.
Bottom line. We have to agree to disagree. I think we both want Americans working and we would love to see the gap close. We just disagree on the route!
The stock market is like a barrometer of the nation's wealth and it is disappearing rapidly. There are all kinds of people with money in the stock market, not just the wealthy and I think all of us respond negatively to the amounts of money being spent knowing that we will be paying it back with interest until they can find no one to lend to us anymore and they start printing it. We've been watching the government spend money in insane ways for months now and it is more discouraging than most of us can bear. Add to that the very real fear of socialism and maybe even communism and any money any one has is going in the mattress.
Bush started it but Obama has outdone any president in spending money and this mess that he inherited fully belongs to him now. I agree that his socialist actions, negative talk (for the purposes of manipulation and getting his plans passed)have caused and continue to cause the stock market to plummet.
Two interesting stats that I picked up: Obama has already spent more money than our government has spent since George Washington up to Obama's inaugeration. Also, it would take 95,000 years to count to a trillion. If that won't break the backs of American taxpayers, I don't know what will.
"just remember there may have been other reasons that people did not like Bush!" Tim
Fair enough. I have lumped you unfairly with everyone else who accused Bush of hurting the economy. My apologies.
"So long as a class of 'super-rich' exist in societies, there will always be poverty." Tim
But the societies that remove the super-rich (Cambodia, Cuba, Russian, China) have far more poor people than nations with super-rich folks.
"I'm not trying to pit classes against each other (im not Jesus!)" Tim
I'd be interested in hearing an argument that Jesus was actually tring to do this. If the road to heaven is narrow (so that only a few can enter it), how can an entire class get through?
"wouldn't it be even better if there was no need in this world for charities in the first place?" Tim
Wow. I am totally devoting an entire post to addressing this one. Remember the way the KJV translates "charity" is the way the NIV translates "love".
Hi Lucy,
you said: "Bottom line. We have to agree to disagree. I think we both want Americans working and we would love to see the gap close. We just disagree on the route!"
Yeah that's it. Neither of us want to see people suffering or out of work, we just disagree on the means to stop it. It's the people who want different ends all together that you need to worry about!
Hi Lavendar,
you said: "Obama has already spent more money than our government has spent since George Washington up to Obama's inaugeration."
I really can't fathom how that could be possible. His stimulus package is around 1 trillion right, and the federal American yearly budget is roughly 3 trillion (i think?).
Hi Matt,
You said: "Fair enough. I have lumped you unfairly with everyone else who accused Bush of hurting the economy. My apologies."
Oh I do think he hurt the economy (well, him + congress), but my argument would not include the stock market. By far my biggest problem with him, however, is the amount of deaths that I believe he is ultimately responsible for.
you said: "But the societies that remove the super-rich (Cambodia, Cuba, Russian, China) have far more poor people than nations with super-rich folks."
You think Cuba, Russia, and China did not have super-rich? Their communism was a farce. They replaced one group of corrupt politicians with another. It wasn't their ideology that stopped the people of pre and post-communism in Russia and China from becoming rich, it was the corruption and severe lack of social stability. All that changed was the rich transformed from capitalists who exploited the people with slave wages, into people who were in or connected to the communist parties.
you said: "I'd be interested in hearing an argument that Jesus was actually tring to do this. If the road to heaven is narrow (so that only a few can enter it), how can an entire class get through?"
Jesus said that the destitute were blessed by God, and he said that it was impossible for wealthy people to enter the kingdom of God. Not to mention the fact he spent his entire ministry with the poor and marginalised groups in society, while he ignored most of the major cities and criticised the religious elite.
you said: "Wow. I am totally devoting an entire post to addressing this one. Remember the way the KJV translates "charity" is the way the NIV translates "love"."
I never said the world would be better without the need for charity; I said charities. We wouldn't need charities if people had the means to feed themselves, protect themselves from easily preventable diseases, and had reliable shelter. Of course that is never going to happen, so we need charities and they are incredibly important institutions.
Tim,
I don't know how you respond to all these posts! If your school's entire debate team turned against you, I would put my money on you!
Again, I might have misunderstood you, but some people (such as Ted Rall) think the government should absorb all the charities out there, while around 80% of people believe faith-based organziations (i.e. charities) do a better job, and I would say out of better intentions.
Hey Matt,
Haha. I enjoy talking about these things, so if I have some spare time i'll take every opportunity to babble on and on. I'm just grateful there are people who read it!
About the charities, I can see how you took what I said to mean the Government should absorb all the charities. With so much rampant poverty around, I think the more avenues for support the better. Every type has its place; whether it be official foreign aid, world bank support, secular charities, faith based charities, and whatever else.
Timothy,
Hi budget hasn't passed yet. Also, his budget is not like any budget that we have ever had in America. When he's done, the government will have control over most everything.
I'm really not smart enough to deal with such large numbers. The analogy came from a source that I trust. It is surreal and matches the way many of us Americans feel watching the government spend such astronomical amounts of our money. Anyway, it doesn't change the fact that he's putting my great grandchildren into debt. His stimulus bill is also a farce. Doesn't anyone understand that government jobs are not self sustaining? They will have be funded again next year.
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