While the futures point to somewhat of a bounce for the Dow, Europe and Asia have retrenched:
|Nikkei 225||7,901.64|| -164.15 -2.04%|
|Hang Seng||12,583.63|| -376.14 -2.90%|
|Straits Times||1,704.52|| -18.85 -1.09%|
|FTSE 100||4,024.07|| -67.33 -1.65%|
|DAX||4,218.36|| -21.49 -0.51%|
|CAC 40||2,883.69|| -41.59 -1.45%|
The Dow now stands at 7949.09, a figure first crossed in July of 1997, and a whisper above it’s pit of 2002 7850. Driving this is a sell off in financials, which was touched off by word that Obama has no fix for the banking crisis, and that internal negotiations are continuing. Plan B? We needed a plan B? This was the man who whipped for TARP with scaremongering about the down in the 9000’s. It was, as the Post notes the worst inauguration day in history for stocks.
The fuzzy vague ophoria that grips newspapers, bloggers, and celebrities, is not born out by his actual record. The disconnect between moment of public unity, backed by media blitz, and policy incompetence, is not as wide as after 9/11, because it is almost impossible for that to occur, but certainly wider than any other time in the last 30 years. Obama’s speech touched off a sell off because the words that Wall Street heard were not rebuilding and remaking but “sacrifice.” Obama is a Hooverite, about cuts and pain and pain and cuts. His new era is not about a new America, but about delivering pain. This is precisely the wrong message.
But right now Americans are only dancing between the sheets, writhing in ex-stasis – the over throw of an old state, not realizing that the man they are hailing as a savior has already made fatal blunders from which neither he, nor the economy, are likely to recover. The debt fear mongers will like Obama’s pain and sacrifice mantra, but anyone in business, has just been told not to invest one dime in new capacity, not to hire one person that can be avoided being hired, and that the only growth industry is turning Afghanis into pink mist.
The global economy, is voting no confidence in Obama, even as Americans rush headlong to praise him. If it is Obama against Depression, I will play for Team Depression. FDR took office and the slide of the banks was a punctuation mark to the incompetence of the Hoover Administration, his inaugural ushered in a new era, not just because of its rhetoric, but because it offered a policy regime: relentless experimentation, direct action, and confronting fear itself. Obama offered a policy prescription: sacrifice, hard choices, sacrifice. Sure there would be some rebuilding, and when someone else does it, Obama will be there to take credit. Wall Street looked at the soup of well turned phrases which no one can remember, and decided that they didn’t feel like being heroes.
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