The John McCain Market Selloff

Ever since the Primary on Tuesday, the market’s have aggressively sold off. This clearly indicates the equity market’s fear of a McCain presidency.

As the charts below show, ever since Tuesday — when McCain’s Intrade price soared — stocks have been under continual pressure.

Had Barrack Obama knocked out Hillary Clinton, a mano-a-mano contest would have taken place. A well rested, fully funded Democratic nominee would have been a very tough opponent for the aging Arizona Senator.

However, the Democratic nomination now looks certain to go on for much much longer. It is highly likely to:

-Physically and emotionally wear down the two Democratic candidates;
-Force them to consume much of their war chest;
-Lead the electorate to become tired of the rhetoric, and disenchanted with both candidates
-Prevent the candidates from spending time doing much opposition research no McCain.

All of this works to McCain’s favor. He can therefore rest, save his campaign warchest, maintain Media presence (but not to the point of over-exposure). All these positives show up at InTrade (see charts below), where McCain’s  bettors have upped the ante, sending his futures skyward.

And, the stock market has sold off, therefore proving that McCain must be bad for stocks and for the economy.

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John McCain Futures Rally

Mccain_chart1202269338169378507

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The John McCain Market Selloff

Dow_week_march_3

~~~

Of course, I don’t believe a word of that. But you would be surprised as to how many otherwise intelligent people spew variations of this sort of nonsense everyday.

I will unequivocally state that anytime you hear this sort of nonsense, you can rest assured that the speaker is a) an unabashed partisan; 2) relatively clueless about how market’s operate; iii) never worked on a trading desk.

Markets operate not as forecastors, but as discounting mechanisms. Consider what has to be discounted to credibly say this:  First, we would need to know who is likely to win the next election, 8 months in the future.

Remember, eight  months ago, it was a lock that Rudy Giuliani was the GOP nominee, and Hillary was going to easily capture the Dem nomination. In case you haven’t been paying attention, eight months is a lifetime in politics.

The next president gets sworn in on January 20, 2009. They have to put together a series of legislative proposals, then get them passed by Congress, then fund them. Then, they have to begin implementing them. The impact of these would likely be felt sometime around 2010.

Hence, the utter absurdity of the short term market twitches somehow reflecting unknown possible events, and their likely macro impact, several years hence. Ridiculous.

Consider these questions as the more likely stimuli this bloody market is actually responding to — the nearer term events that are still unfolding today:

-Are we in a recession or not?
-Is the credit problem fixed yet?
-How much worse will housing get?
-Will earnings rebound in the second half of 2008?
-Will the US dollar ever stop falling?
-Are US deficits going to continue to skyrocket?
-How much more will consumers pull back on their spending?
-(Did I mention the housing picture is a disaster?)
-The war in Iraq is God-awful expensive, is there any relief in sight?
-Is Oil going to go to $150?
-Can the wobbly banks regain their footing?
-And how much more will inflation heat up?


The markets have enough data to digest before they even remotely begin to consider who might be president in 2009, and what they might do . . .

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  1. SPECTRE of Deflation commented on Mar 7

    Do these headlines look like John McCain means d#ck concening our problems? Maybe it’s a realization that we are truly screwed, and even the sheeple now somewhat understand that they have been had. By the way, John McCain like the other candidates sucks the big one!

    Fri Mar 7 2008
    U.S. Mortgage Foreclosures Rise as Owners “Give Up” (bloomberg.com)
    House Foreclosures Hit Record High (biz.yahoo.com)
    Mortgage Foreclosures Reach All-Time High (washingtonpost.com)
    Houseowner Equity Below 50%, Lowest Since Records Started (biz.yahoo.com)
    House debt greater than equity for first time (usatoday.com)
    Forget the flat-screens, builders are slashing prices (latimesblogs.latimes.com)
    Fresh gloom for US housing market (news.bbc.co.uk)
    Dollar’s Decline a Crisis of Solvency – Not Liquidity (seekingalpha.com)
    Bond Markets “Utterly Unhinged” (bloomberg.com)
    Bernanke Urges Banks to Forgive Portion of Mortgages (bloomberg.com)
    Bernanke Urges Gift For Debtors Only; Screw Savers! (fool.com)
    Bernanke Call for Mortgage Forgiveness Puts Pressure on Paulson (bloomberg.com)
    Agency Mortgage-Backed Bond Spreads Reach Highest Since 1986 (bloomberg.com)
    Credit Swaps Thwart Fed’s Ease as Interest Rates Rise (bloomberg.com)
    Some saw credit crisis coming three years ago (economist.com)
    We’re just in the first inning of the housing crash (marketoracle.co.uk)
    Prices cut for Oakland condo auction (sfgate.com)
    Reduced rental demand noted for the SF Bay Area (lansner.freedomblogging.com)

  2. michael schumacher commented on Mar 7

    half the hedgies are getting margin calls….
    of course that has nothing to do with it…

    Nice sell program that just hit the tape…

    Ciao
    MS

  3. kckid816 commented on Mar 7

    Great post. I’m going to have to send this to all my financially illiterate marketing major friends who like blame the current malaise on the pols (who are late to the table on all these issues) instead of the people who actually got us into this mess.

  4. SPECTRE of Deflation commented on Mar 7

    Here’s some more that says the candidates don’t matter. It’s a realization of where we are as country.

    Friday, March 07, 2008

    Housing crisis gets even worse
    The Argus, CA

    Realtors celebrate new limit
    TheReporter.com, CA
    The limits, with a maximum at $729750, are derived from median home prices in each county. For Solano County, Realtors learned Thursday, that means the …
    The Housing Market Is Nowhere Near Bottom
    Huffington Post, NY

    Maryland Foreclosures Surge!

    Lenders were trying to foreclose on more than 13,000 homeowners at the end of last year, up about 150 percent from a year earlier, the Mortgage Bankers Association said yesterday. That’s the biggest 12-month increase since the trade group began tracking the state numbers in 1979.
    Mortgage dangers skyrocket in state
    Baltimore Sun, United States

    Americans’ home equity lowest since 1945
    Philadelphia Inquirer, PA

    Sacramento area part of continuing grim foreclosure forecast (CA)
    Sacramento Bee, USA

    Housing, Bank Troubles Deepen
    Wall Street Journal
    The unwelcome contrast provides stark evidence of how falling home prices are weighing on consumers. And it could add urgency to efforts by Federal Reserve …
    Drive mounts for US government bailout of banks
    World Socialist Web Site, MI

    Investors Dump Securities From Fannie, Freddie Mortgage Sector
    Washington Post, United States

    Mortgage crisis guts Cleveland neighborhoods as it bypasses Buffalo (OH, NY)
    Buffalo News, United States

    LV not only area suffering home-value Declines (Vegas)
    In Business Las Vegas, NV

    Stocks Drop To 18-Month Low After Foreclosures Hit Record
    Evening Bulletin, PA

  5. Jay Weinstein commented on Mar 7

    I seldom watch CNBC, but was struck this am by the comment from someone that the debate is no longer whether we are in a recession, but how bad and long it would be. No one argued with him.

    That is a major paradigm shift by the mainstream investment community..

  6. mike carey commented on Mar 7

    I wonder why the US finacial press cann’t get cogent,accurate and thought provoking articles like this recent article in the Financial Times:
    Vicious spiral haunts debt markets
    By Gillian Tett

    Published: March 6 2008 22:08 | Last updated: March 6 2008 22:08

    This weekend the Group of Ten central bankers will convene in Basel for one of their regular pow-wows.

    Almost three months ago, a similar gathering paved the way for an unprecedented bout of collective action in the money markets that was supposed to halt the sense of financial panic. Months later, the grisly truth is that market anxiety is seeping back with a vengeance. Thus the crucial question confronting the central bankers this weekend, as they fly in to snowy Switzerland is twofold: first, are we on the verge of a new downward lurch? And second, is there anything the G10 bankers can actually do to stop this?

    A downward lurch does look a real danger now, not least because the central bankers themselves are looking increasingly impotent when it comes to tackling the fundamental reasons why sentiment is so fragile.

    The western financial system is caught in a trap. On the one hand, there is an urgent need for clearing prices to be established for impaired assets to restore confidence; on the other hand, if this is done in a mark-to-market world, there is a risk that some banks will run out of capital. Policymakers are in the unenviable position of knowing almost any step they take risks denting sentiment further.

    First, a bit of background. History suggests a crucial component for ending a financial crisis is to establish some sense of clearing prices. Once goods look cheap – and it does not seem they will soon become cheaper still – buyers tend to rush back in. This, after all, is Economics 101, and it applies as much to houses and cars as collateralised debt obligations.

    Now, in theory, there are plenty of reasons to expect investors to start rushing into the credit markets soon, in a manner that could stabilise sentiment. After all, many credit prices have slumped dramatically. And while banks may be capital constrained, plenty of investors are sitting on pots of free cash, such as sovereign wealth funds and even mainstream asset managers and pension groups.

    But these groups are notably not buying credit yet, either because they are still paralysed with shock or, more realistically, because they have a nasty feeling that while a leveraged loan, say, looks cheap, it could be cheaper in the future.

    How can you combat this? Fifteen years ago, the US government devised a clever trick in the aftermath of the savings and loans crisis, by conducting firesale auctions of S&L assets. This was brilliantly effective in establishing clearing prices and turning sentiment around, because as soon as investors saw some assets being sold at knockdown prices they starting jumping in, meaning that within a few months, prices were rising again.

    But these days the US government faces a crucial impediment to repeating this trick. Back in the days of the S&L crisis, US banks were not forced to mark their books to the firesale prices. But now the mark-to-market creed has taken hold. And it is a fair bet that if US banks were forced to mark their books to the initial clearance price for a CDO squared, say, some would run out of capital. Hence the trap: in the modern financial system, you can have mark-to-market accounting systems, or quick action to establish clearing prices, but probably not both, without blowing up some banks.

    Of course one way to exit this trap would be to abandon the mark-to-market rules for a while, or loosen capital adequacy standards. Some furtive discussions between policymakers along these lines are already occurring.

    But I would be surprised if any action occurs soon. So the risk now is that we will remain trapped in this climate of grinding fear for months – at best. Few institutions have much incentive to voluntarily create clearing prices. However, hedge funds are now being forced to make asset sales in an ad hoc, opaque manner that is adding to the sense of fear. This is forcing the banks to mark books lower and pull in their horns, sparking even more hedge fund sales and fuelling concern about banks. It is a viciously unpleasant spiral.

    Let us all hope the G10 have some amazing new tricks up their sleeves; if not, we are moving into dangerous waters.

    gillian.tett@ft.com

  7. michael schumacher commented on Mar 7

    This last two hours is going to be fun…..

    Goog and APPL at 52 week lows…and some decisions to be made before the clock strikes 4pm…

    make some popcorn and sit tight….

    Whoosh won’t even begin to describe it….
    *notice I did not say which way* ;-)
    Ciao
    MS

  8. knifecatcher commented on Mar 7

    The Hillary-Obama battle is bad news, not good, for John McCain. They will get all the attention, McCain will be a footnote. Ask Rudy how well having a free ride through the early primaries worked for him in Florida.

    Still, a “McCain selloff” is laughable. No candidate in either party has the capacity nor the courage to provide real, long-term solutions to the economic problems we now face. It doesn’t matter who the temporary occupant of the White House will be in 2009 and beyond. They will only function as a punching bag for distressed Americans.

  9. John commented on Mar 7

    Breaking news on Bloomberg: “Bush says stimulus plan has given the economy a booster shot”.
    “We recognized the problem EARLY”.
    This is the same man who just last week said he had not heard that gas prices would likely go to 4 dollars a gallon. Seemed Utterly Flummoxed by the prospect. This week he’s lost as to why OPEC won’t pump more oil.
    The level of Incompetence of this man and his administration is beyond the pale.

  10. Lord commented on Mar 7

    Sure is funny though.

  11. DonKei commented on Mar 7

    BR,

    Great post.

    The pol’s say things like the anticipated election of “x” spooked the markets only because in their little world, politics are all that matter.

    But they have it backwards–pol’s matter precious little, and is/are always catching up to markets, and running to the front of them and pointing and saying, “there, see what I did?”

    Unfortunately, a fair number of the sheeple (props to whomever coined that one) believe it.

  12. stormrunner commented on Mar 7

    Exactly what we need to solve a crisis induced by lax banking regulation, a McCain presidency.

  13. LFC commented on Mar 7

    Barry, you really do sound like you’re channeling Kudlow … other than you aren’t reflexively bashing the Dem. The difference is that you understand that it’s bull.

    Kudlow has blamed several downturns on Nancy Pelosi since licking his wounds over the 2006 GOP loss. For her part, Nancy must be shocked to find out that she’s a major market mover.

  14. Pat G. commented on Mar 7

    “This clearly indicates the equity market’s fear of a McCain presidency.”

    You could say the same thing when looking at Obama’s & Clinton’s economic plans. I think the market’s downdraft is based on the issues you raise and everyone else who believes otherwise is just in denial.

  15. cathompson commented on Mar 7

    Market goes down far enough some people could pick up a sense of humor – cheap! When the next rally starts it’ll be anticipating pinky and the brains departure? Ghosts and empties – Paul Simon

  16. Marcus Aurelius commented on Mar 7

    The NEXT president? The treasury is being looted NOW. By THIS President. The next President is getting screwed forward. I might vote for the Republican.

  17. techy2468 commented on Mar 7

    BTW…

    how come nobody is making a tradeable bottom/low prediction yet?

  18. Josh commented on Mar 7

    All thanks to the Ohio Republicans who jumped party lines to vote overwhelmingly for Hillary. Seems McCain can beat her, but not Obama.

  19. Kurt Milne commented on Mar 7

    I almost lost my lunch – until I read below the line. That is no way to treat us loyal readers trying to unwind going into the weekend :)

  20. cathompson commented on Mar 7

    I tried that yesterday with UWM and escaped with my life earlier. Its a runaway train right now.

  21. michael schumacher commented on Mar 7

    no rumor about AMBAC??

    I’m disappointed to say the least….

    Marcus-

    pondering that as well, let them clean up there own mess. Seriously…neither of them (Hillbama) are electable as stand alone or together. Together they are setting themselves up for failure and handing it to McCain on the backs of conservative demos.

    I hate to say it this way but what I see being presented is a choice between ” a womin’ (and not just any woman IMO) and…..ahem…. an “african-american”

    Neither would get much conservative support.
    thus allowing us the have to put up with Bush lite for an additional 4 years.

    BTW I still think Cheney factors into this at some point…..

    Here come the plungers…..right on cue!!

    Ciao
    MS

  22. Chief Tomahawk commented on Mar 7

    Wow! This entry is a dead ringer for Larry Kudlow and his “Hil-bama” speak.

  23. donna commented on Mar 7

    Good gawd, the afternoon spike is getting predictable.

    Even I called it today in an email to one of my mailing lists! ;^)

    Can I beez day trader nowz? ;^)

  24. Portland Refugee commented on Mar 7

    Schumacher,

    Please explain your “ahem…african american” comment. Perhaps your intention wasn’t as ominous as it read.

  25. Portland Refugee commented on Mar 7

    MS, Please void my question. I see where you are coming from.

    I respectfully disagree. Hillary I believe in the end is gonna hit the wall. Anything Neo-Con is dead. Over.

    They may have a small “market share” which is overly hyped in the media but rationality will prevail.

    This race is between McCain & Obama. McCain will get slaughtered via his Iraq stance.

  26. Stuart commented on Mar 7

    This consistent 3:00 pumping is total BS. Right up there with CNBC propagated rumours. Suspicious as hell.

  27. N commented on Mar 7

    Here’s an update from Dr. Kudlow – to FAs around the country! three months ago Mr. K was pounding the table on shock and awe rate cut!

    McCain Must Get Behind King Dollar

    March 3, 2008

    Lawrence Kudlow

    If Sen. John McCain wants to run as a candidate of change, and if he’s truly interested in distancing himself from President Bush, he should reverse the declining fortunes of the Bush wartime dollar.

    Right now the greenback is in virtual freefall. It’s a disorderly drop. As a result, U.S. inflation rates are rising across-the-board as the global commodity boom leaks into higher domestic inflation.

    Inflation is the cruelest tax of all. It robs consumer and wage-earner purchasing power. It erodes business profits. It reduces the real worth of investor portfolios.

    It’s also the single biggest cause of recession, and it may well be tipping the economy into negative territory.

    For the first time in a decade I’ve become genuinely worried about inflation. Over the last year and a half, inflation has climbed from 1.5 percent to nearly 4.5 percent, and in the past three to four months it has trended sharply higher.

    But there’s another side of the dollar story that’s equally important. The falling U.S. greenback has become a symbol of American decline.

    Folks are making fun of the dollar. Our enemies around the world are pointing to the unreliable dollar as evidence of American weakness. It’s as though the administration’s neglect of the dollar is “peso-izing” or “Latin-Americanizing” the greenback.

    Something must be done to reverse this trend, and McCain is in a good spot to do it. Remember, McCain was a foot soldier in the Reagan revolution. Borrowing a page from the Gipper — who always said a great nation has a strong currency — he should argue on the campaign trail for a dollar surge.

    For patriotic reasons alone it is time to reverse the decline of the dollar. A strong dollar should be

    emblematic of a strong America and a strong defense. Sen. McCain should insist that a President McCain will order the Treasury Department to back up its stale “strong dollar is in the nation’s interest” rhetoric with real open-market actions to boost the greenback. He should say that his Treasury will take actions to strengthen the greenback by conducting dollar diplomacy with Europe, Britain, Canada, and Japan. He should also state that a President McCain will appoint a Federal Reserve chief who will stop ignoring the dollar, as Fed Head Ben Bernanke did last week before Congress.

    Sen. McCain can bolster his agent-of-change credentials by placing the U.S. dollar front-and-center in his campaign. The time has come to end the dollar’s freefall. The time has come to end the period in which the greenback has become the subject of international ridicule. The time has come to show voters on Wall Street and Main Street that $1,000 gold, $100-plus oil, and a rising inflation rate will not stand.

    It is time to get behind King Dollar.

  28. John F. commented on Mar 7

    Brilliantly reasoned! Have you shared this with your friend/buddy/pal Larry?

  29. Stuart commented on Mar 7

    Kudlow is another one that doesn’t get it. You can “will” the buck up all you want, but unless you enact policies to change the fundamental course of fiscal deficits, futile pissin’ in the wind. The thing is, deficits are now compounding upon themselves as interesting is compounding on interest. We have to borrow more money just to pay the interest past borrowings. Try that with your credit cards and see how that works for you. It’s too late to change bucky’s future.

  30. Brian Foote commented on Mar 7

    I’m in the camp with those who think it really doesn’t matter who gets elected. We are f***ed. Politicians, pundits…they are all morons. Anyone who knows anything doesn’t watch that crap. You can see through it before the first commercial. Speaking of which, anyone who has dropped major coin on an MBA, MSF…any graduate degree; can we all agree that our society is based on a big pile of BS. Excess credit makes markets go up, a lack of credit (hello, now) makes markets go down. Now please excuse me while I consult my dividend discount model, monte carlo simulation….etc. My Uncle told me to buy gold at $250. My MBA/CFA in me scoffed at him. He’s 70, but maybe he should get a job on the street. At least he’s ethical, unlike the scumbags roaming around now. On the other hand, that’s how Joe Kennedy got his money and we ended up the proud recipient’s of that piece of sh*t in the US Senate.

  31. Dirk van Dijk commented on Mar 7

    You make the mistake of thinking Kudlow knows anything about economics

  32. scorpio commented on Mar 7

    great news! Dick Bove says buy all the C you can at $20! to go along w his earlier recommendation to buy all the C you can at $35! what a tool

  33. Brian Foote commented on Mar 7

    The really sad thing about this election and every election….Informed, educated people can smell this crap a mile away but most people don’t think about it for a second. They just want the “regular scheduled programming” to continue. They don’t realize it but the regular scheduled programming is happening and right on time.And to every citizen’s detriment.

  34. Dee Leverage commented on Mar 7

    Kudlow Update:

    1) We are talking ourselves into a recession…it wouldn’t happen otherwise.

    2) Recession is a great time to buy stocks!!!!

    Details at 7 PM.

  35. PFT commented on Mar 7

    I read it as a Bloomberg push for a running mate. Coincidentally, that firecracker that popped off in front of the recruiting station at 4 AM allowed Bloomberg (now an independent) to get some national exposure on Fox and CNN. McCain (the economy is not my strong point, just give me more war) and Bloomberg (billionare Wall Street darling) seems to be a match made in heaven (Obama is also considering Bloomberg, assuming Bloomberg is not running as an independent, but his fate is uncertain, and Hillary would go with Obama as a running mate leaving Bloomberg free for McCain)

  36. kennycan commented on Mar 7

    Gimme a break. Hilary rose from the dead Tuesday as well. How about the Hillary Slide instead?

    I’m in the camp with those who think it really doesn’t matter who gets elected. We are f***ed.

    Exactly!

    PS I see too much “all”s and “everyone”s on this site lately as in “All Republicans are evil”, “All Democrats are evil socialists”, and “Everyone on Wall Street is crooked and screwing the little guy”. If you did that with a race or ethnicity, what would most people call you? Think about this before you post with blanket statements using all and everyone etc.

  37. Pool Shark commented on Mar 7

    kennycan,

    Absolutely right! All you people who make blanket generalizations about Republicans and Democrats are idiots. Everyone who believes that all members of a political party are evil is a sub-moronic fruitcake.

    All generalizations are false; including this one.

  38. SFH commented on Mar 7

    Zinger… right at your asshat friend Kudlow. You posted earlier that sometimes Wall Streeters need the old 2×4 to the face wake up call and he and Cramer are at the top of my list.

  39. rickrude commented on Mar 7

    Wow, Larry Kudlow actually posting on this board. Man, he’d better have a thick skin,
    there has not been that much positive posted on him on other threads.

  40. St. Pauli Girl commented on Mar 7

    Barry,

    You have been excessively harsh on Larry lately. Something is going on between two of you. (Oh well)

    Romney was the best presidential candidate (sigh).

    McCain is more a democrat than a republican (scary).

    Billary is a commie (seriously, she is a commie). I get real nightmares in the middle of a night about her becoming our president.

    Barak Hussein Obama is a cult-like talker with a long list of unrealistic promises. (Naïve folks are salivating and drooling when he talks). I am afraid he will bankrupt the country.

  41. Stuart commented on Mar 7

    Balls of steel they have…rusting away too. You can’t make this stuff up.

    MBIA, Facing Downgrade, Asks Fitch to Stop Rating

    March 7 (Bloomberg) — MBIA Inc., under threat of a downgrade, asked Fitch Ratings to stop issuing credit rankings on its insurance units, saying the grades have become less valuable to investors, of little use to the company and too expensive to maintain.

  42. St. Pauli Girl commented on Mar 7

    It is a good idea Stuart. Nowadays nobody trusts the credit rating agencies anyway. Their rankings are of little use to investors.

  43. Dude commented on Mar 8

    My Mexican friends keep calling me and asking if presidente McCain plans to give them amnistía is they come here illegally.

  44. Hopeless Pedant commented on Mar 8

    Ever since the Primary on Tuesday, the market’s have… ? C’mon, Barry! Yes, this is an apostrophe flame.

  45. EB commented on Mar 8

    Who cares who wins??

    Don’t follow leaders and watch your parking meters.

    It’s every sentient being for him self!!

  46. gypsy howell commented on Mar 8

    Barak Hussein Obama is a cult-like talker with a long list of unrealistic promises. … I am afraid he will bankrupt the country.

    He’ll be a little late to the party, don’t you think?

  47. blam commented on Mar 8

    Very good op-ed; the point you bring home is right on !

    IMO, bad journalism speak and analysis is at the core of the bubble economy. Hedge funds or IBs use the popular press to move security prices by creating pablum shit scenarios, wrapping it up in a diaper of offical sounding analysis and grammatically correct info speak, and feed it to the MSM reporters. They gobble it up, add a few lines, and make the deadline.

    Why won’t anyone believe what we are saying ? Why is the credit crunch spiralling out of control ?

  48. mark stotko commented on Mar 8

    Barry,
    LOVING YOU!

    LONG AGO, anybody with more than a shoe sized IQ sees the SLANTED, NOISEY, SMUG,
    POLICY WONKED HOST as utter nonsense. but,
    many of us like to watch for the few GREAT
    GUESTS(the ones not blowing him)….

    …we will miss you
    thanks for letting off the steam
    KEEP UP THE GREAT WORK

  49. David commented on Mar 8

    How can any serious economist argue that “Hillbama” would be good for the economy? They’re good for union workers in the manufacturing sector, and good for people in the bottom 25% of the income scale, but otherwise bad for the economy.

  50. ef commented on Mar 8

    Couple things come to mind:

    Stiglitz on McCain: If He Doesn’t Understand the Economy, He Doesn’t Understand Security

    Short Attention-Span Theater

    I’ve been think’n about this attention span thingie, because I remember 8 or so years ago, when Bush and McCain were vying for the nomination, and all the stuff Karl Rove and the “Republican” party conjured up and filtered out to the masses to influence voters. If Rove and “the Party” were saying McCain was mentally not well because of his Vietnam experience, and worse stuff, oh hum, what are we suppose to make of it 8 years later. Oh, that American attention span thinkie…

    “Of course, I don’t believe a word of that.” – Ditto!

    “I will unequivocally state that anytime you hear this sort of nonsense, you can rest assured that the speaker is a) an unabashed partisan; 2) relatively clueless about how market’s operate; iii) never worked on a trading desk.” – There should be a disclaimer on all financal reporting. I read once, that financial reporting is the position you get when you can’t get any other in the media world (Maybe that explains Maria Bartiromo). When I feel I’m getting lulled into their bs I think of 4 movies:

    • Trading Places
    • Boiler Room
    • Wall Street
    • Enron: The Smartest Guys in the Room
    • Plus a pinch of Frontline/Nova: Bigger than Enron, Trillion Dollar Bet, Dot Con, The Wallstreet Fix, The Crash
  51. Joshua Whalen commented on Mar 9

    Well, this situation has got to be brought to a close before it becomes a bare-knuckles brawl all the way to the convention. What with Hillary now praising John McCain over the likely Democratic nominee, it’s obvious she intends a scorched earth strategy that will leave the party so badly wounded it can’t win in November, and she probably actually believes she’ll have another shot in 2012.

    Therefor, I propose that the best way to end this charade of self-immolation is for Obama to declare a Veep choice NOW, before or immediatly after the Pennsylvania primary, and choose someone who can split Hillary’s constituency right down the middle.

    The person should be female, a boomer, a respected elder stateswoman, preferably to the left of either Hillary or Obama himself. They should be devastating, lawerly debater, soft spoken but razor-tongued, encyclopedic, and preferably both loathed and feared by both the neocons and the DLC. They should have immpecable feminist credentials that wither Hillary’s “But I was married to a governer and a president” claims to experience with towering accomplishemnts in Washington and abroad, and with a comprehensive knowledge of mid-east politics, and with at least some recent reality-based community recognition. A background in government finace would be icing on the cake.

    The person who best fits this description is former NYC Rep. Elizabeth Holtzman. Holtzman was either the youngest or one of the youngest people ever elected to congress in 1972 at the age of 31. A Columbia and Harvard law grad, she was the point-woman in the congressional investigation of the Watergate break-in, alongside fellow Brooklyn Congress woman and legend Shirley Chisolm. Holtzman earned a reputation for relentlessness and attention to detail during the initial hearings that lead to Nixons resignation. She later went on to be a principle sponsor of the Equal Rights Amendment, and led the campaign to extend the ratification deadline in the late ’70’s.

    More recently, she served as Brooklyn DA, NYC Comptroller, and is the author of “The Case for Impeaching George Bush”.

    Hillary’s slate of super delegates includes NYC Rep. Jerry Nadler, NYS Assembly speaker Shelly Silver, NYC Rep. Carolyn Maloney, NYC Rep. Yvette Clarke, NYC rep. Nydia Velasquez, all of whom have either served with Holtzman in congress, worked with her when she was comptroller, or supported her in her 2 campaigns for the US Senate seat now held by Hillary Clinton.

    I’m building support for this on my blog at http://www.panix.com/~joshua/blog/ and hope to have an online petition up by late Sunday afternoon. I personally believe that given the contemporary make up of the Deocratic electoral base, which is essentially blacks, hispanics, women, jews, union labor, and college-educated young people, that an Obama-Holtzman tiicket basically takes it away. Hillary’s coalition is terribly vulnerable to another, stronger, feminist presence in the race, especially one with far more authentic feminist cred than she has, and one who is even more of a policy wonk. Given her background as a District Attorney in what was New York’s corrupt, violent borough during the 1980’s and early ’90’s, I pity the poor fool that has to debate her.

    If you think I’m not nuts, drop by the blog, and post a comment. I think this can be made to happen, and if it can be made to happen fast, it can end this farce before it destroys the best shot the Democrats have had in my lifetime.

    Thanks!

  52. Todd commented on Mar 9

    Oh yeah, what a great idea Larry Kudlow is offering to have John McCain spout about intervening in the forex markets as the sole means of shoring up the value of our pathetic, laughingstock US Dollar, without offering any truly meaningful, draconian reforms to eliminate quickly our mindboggling national debt and not by some nonsensical 5 years down the road (i.e. social security, medicare AND MILTARY EXPENDITURES).

    For an encore, maybe Larry can suggest we all piss into the wind in the hopes that it actually won’t fly back in our direction.

    I strongly suggest Kudlow should spend a great deal of time using his show as a platform to truly address the issue of the ruinous policies of the federal government and how to avoid a bankruptcyof the US Treasury. This will require major reform of sacred cows important to both Democrats and Republicans. It doesn’t take rocket science in my mind to effectuate the necessary reforms without which we are dooming ourselves to the economic abyss.

    Some obvious suggestions:

    1. Gradually raise the retirement age to 70 or even 72, so that people who are 45 now have their retirment age at 66, people 40 now have their r.a at 67, people 35 now have their r.a at 68, people 30 now have their r.a at 69, people 25 now have their r.a at 70. The same retirement age will also apply to receiving Medicare benefits. Allowing some very labor intensive jobs like road construction for retirement at 65 permanently can be considered.

    2. Completely reform the Pentagon budget so that we aren’t paying for weapons meant to fight a Cold War era war. US taxpayer dollars can not be used to support various military bases at the risk of creating local economic crises and protect jobs that create weapons that are obsolete to today’s military needs. We must eliminate the huge expense of keeping thousands and thousands of troops in Germany, Japan and Korea. World War II and the Korean War ended 63 and 54 years ago respectively, and we can’t afford to subsidize other countries’ military requirements. Set dates to gradually draw down troops from Iraq. Redeploy some of the money saved by spending on measures to ensure the safety of our borders, ports and airports and missile defense systems.

    3. Dramatically reform government spending so that government jobs do not provide better pay and better benefits than the average private sector job. Institute bonus structures in government pay so that good performance (that can be quantifiably measured in savings in goverment expenditures) is rewarded, and inept people can be fired from government jobs as easily as they can from private sector jobs. Institute a policy of attrition so that jobs vacated by inept personnel are not necessarily replaced, thereby reducing compartment budgets over time. Pension reform for government jobs is a major necessity.

    4. A complete overhaul of the prescription benefit for senior citizens, requiring strict guidelines as a means testing. Senior citizens who can afford their medications should never be subsidized.

    5. A systematic review of people receiving government benefits for disability issued more than 5 years ago. Continued proof of inability to work as certified by an independent doctor becomes required.

    These are just a few off the top of my head. What about it, Mr. Kudlow? How about some bipartisan suggestions about the way to get us out of this mess. Intervention in the forex markets? Gimme a break !!!!

    As for Mr. McCain, it would be a breathe of fresh air if he addressed some of structural issues in all of the areas I mentioned. The American electorate must accept the truth and hear the required reforms, and McCain must prove that his straight talk isn’t just a campaign slogan. To this point, all McCain seems to be saying is ”Bushie, you’re doing a heckuva job.”

  53. Todd commented on Mar 9

    Oh yeah, what a great idea Larry Kudlow is offering to have John McCain spout about intervening in the forex markets as the sole means of shoring up the value of our pathetic, laughingstock US Dollar, without offering any truly meaningful, draconian reforms to eliminate quickly our mindboggling national debt and not by some nonsensical 5 years down the road (i.e. social security, medicare AND MILTARY EXPENDITURES).

    For an encore, maybe Larry can suggest we all piss into the wind in the hopes that it actually won’t fly back in our direction.

    I strongly suggest Kudlow should spend a great deal of time using his show as a platform to truly address the issue of the ruinous policies of the federal government and how to avoid a bankruptcyof the US Treasury. This will require major reform of sacred cows important to both Democrats and Republicans. It doesn’t take rocket science in my mind to effectuate the necessary reforms without which we are dooming ourselves to the economic abyss.

    Some obvious suggestions:

    1. Gradually raise the retirement age to 70 or even 72, so that people who are 45 now have their retirment age at 66, people 40 now have their r.a at 67, people 35 now have their r.a at 68, people 30 now have their r.a at 69, people 25 now have their r.a at 70. The same retirement age will also apply to receiving Medicare benefits. Allowing some very labor intensive jobs like road construction for retirement at 65 permanently can be considered.

    2. Completely reform the Pentagon budget so that we aren’t paying for weapons meant to fight a Cold War era war. US taxpayer dollars can not be used to support various military bases at the risk of creating local economic crises and protect jobs that create weapons that are obsolete to today’s military needs. We must eliminate the huge expense of keeping thousands and thousands of troops in Germany, Japan and Korea. World War II and the Korean War ended 63 and 54 years ago respectively, and we can’t afford to subsidize other countries’ military requirements. Set dates to gradually draw down troops from Iraq. Redeploy some of the money saved by spending on measures to ensure the safety of our borders, ports and airports and missile defense systems.

    3. Dramatically reform government spending so that government jobs do not provide better pay and better benefits than the average private sector job. Institute bonus structures in government pay so that good performance (that can be quantifiably measured in savings in goverment expenditures) is rewarded, and inept people can be fired from government jobs as easily as they can from private sector jobs. Institute a policy of attrition so that jobs vacated by inept personnel are not necessarily replaced, thereby reducing compartment budgets over time. Pension reform for government jobs is a major necessity.

    4. A complete overhaul of the prescription benefit for senior citizens, requiring strict guidelines as a means testing. Senior citizens who can afford their medications should never be subsidized.

    5. A systematic review of people receiving government benefits for disability issued more than 5 years ago. Continued proof of inability to work as certified by an independent doctor becomes required.

    These are just a few off the top of my head. What about it, Mr. Kudlow? How about some bipartisan suggestions about the way to get us out of this mess. Intervention in the forex markets? Gimme a break !!!!

    As for Mr. McCain, it would be a breathe of fresh air if he addressed some of structural issues in all of the areas I mentioned. The American electorate must accept the truth and hear the required reforms, and McCain must prove that his straight talk isn’t just a campaign slogan. To this point, all McCain seems to be saying is ”Bushie, you’re doing a heckuva job.”

  54. The Big Picture commented on Mar 28

    Stock Market Politics

    I love when this happens: In the beginning of the month, I jokingly referred to the market correction as The John McCain Market Selloff. I was — rather sarcastically, I thought — pre-empting the usual poor analysis that comes from partisan quarters. …

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