Obama isn't even in office and Wall Street is already unhappy with his performance.
From the stock portfolio point of view, there's some sense of optimism and hope that Obama's team will promote economic spark plugs that fire the engine into shape. The analogy of the paddles that shock the heart back into a rhythm may be more appropriate.
The scenario remains the same because this sense of optimism is surrounded on all sides by layoffs, profit loss, bad credit, and the "Great Recession." The water is coming in faster than Obama can bail it out with regular appearances that promote his economic ideas.
Then the real stinker, the utter stink bomb smoker to the entire enchilada is deflation. Deflation is the "consumption of 09" withering away assets and value to all that we hold dear, while we are left with the flaccid atrophy of previously pumped American muscle.
Reuters: Tough times dim Wall Street's honeymoon with Obama
"I think we're torn between optimism (about) the new administration and stimulus plans and the awful economic outlook..."
"The biggest risk that we're seeing today is the potential for deflation..."
"It would really take amazingly terrible data to get the stock market much lower..."
"Under this scenario, we believe a year-end S&P target of 1,000 to 1,050 would be reasonable..."
1 comment:
It's pretty ugly out here. Parts of the economy are indeed deflating faster then the Hindenburg but amazingly others are still rapidly inflating as if they're not connected to the larger reality. Examples are in order here. Health care! What planet is this entire Industry on? Public services, toll roads , bridges etc. The States are actually raising feed and taxes precisely when the private economy is imploding in so many areas. Defense is another sector that just keeps on spending like were at war with the entire Galaxy. Until, all these inflating sectors are brought in line the other areas will continue to deflate.
Obama needs to cut defense fast ( ending the misbegotten War on terror and it's failed Iraqi venture would deduct some of the defense part. Getting health care , specifically the Pharma side in line means reversing the disastrous BV$H drug fiasco and allowing the FEDS. to use their market leverage to buy drugs en mass. Then of course there is the health care rackets now calling themselves health Ins. companies. This is a very hard nut to crack because these vandals have their claws into every pol of any stature including Obama. The last is probably even more intractable, sadly. The people who run the States and the many quasi-authorities seem to think all the rest of us exist to feed their fantasies. This will end with bankruptcy and defaults in places like NJ and Calif.
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