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| Contributor | ArmyDem |
| Last Edited | ArmyDem Mar 16, 2009 10:56am |
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| Category | Commentary |
| Media | Weekly News Magazine - New Republic, The |
| News Date | Friday, March 13, 2009 04:00:00 PM UTC0:0 |
| Description | by Jonathan Chait
Quit blaming the market's collapse on Obama
Post Date March 13 2009
The one conservative talking point that has gotten the most traction since Barack Obama won the election is that he's killing the stock market with his big-government agenda. Conservatives pundits started saying this in November, and mainstream news implies it constantly. "Stocks are down almost 19 percent since the Obama administration took office," reported ABC News recently. MSNBC has been endlessly featuring a graph of the stock market's decline since Obama took office. While Obama's economic policies have gotten plenty of things wrong, the idea that they can be judged by the stock market is unbelievably fatuous.
To understand this ubiquitous notion, let us start at the bottom of the conservative intellectual food chain and work our way up. The crudest version of the Obama Bear Market hypothesis is put forward by the likes of Rush Limbaugh, Sean Hannity, and Fred Barnes. Their favorite data point is that the market tanked at several key moments: the day after the 2008 presidential election, the day of Obama's inauguration, and the day he signed the economic stimulus bill. Clearly the markets panicked in reaction to Obama's incipient big-government, wealth-confiscating agenda, right?
Sure, unless you realize that those events just might have been priced into the market already. Obama, in case you forgot, was considered a lock before Election Day. (On election eve, Intrade had given Obama a 92 percent chance of winning.) Likewise, the vote that made the stimulus bill a fait accompli took place several days before the bill's signing. The real market-driving news came even earlier, when Obama unveiled his plan. Contemporaneous reports on the market reaction-The New York Times, December 9: "WALL STREET SURGES ON STIMULUS HOPES"-dug up little evidence of fears about socialism. |
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