On March 4th, Barack Obama made the following comment regarding the stock market:
What you’re now seeing is profit-and-earning ratios starting to get to the point where buying stocks is a potentially good deal if you’ve got a long-term perspective on it.
Since then, stocks have fallen approximately another 300 points, to a point unseen in over 12 years. As anyone with finance experience can tell you, the above statement by Obama was in effect a “buy” rating for the capital markets. Financial analysts give “buy”, “hold”, or “sell” ratings to stocks to tell investors what to do with their money. If a financial analyst gives a company’s stock a “Buy” rating, the stock price usually rises because investors buy the stock believing that it is a good investment in the long run. Obama’s “buy” rating for American stocks have lead to a week-long decline
As we reported here, stocks have crashed in an unprecedented fashion under the Obama administration. Since I posted that story, liberals have come on this site to defend their Messiah, claiming Bush is to blame for the spiraling collapse of our capital markets, even though the crash grew in magnitude AFTER it became clear Obama would be our president, and has continued unabated under his administration.
To give you a sense of how badly the stock market has collapsed, consider that major United States corporations in the S&P 500 on average have the same value that they had in 1997. Investors believe that the mass proliferation of broadband, internet, cell phones, DVDs, laptops and wireless technology have added ZERO value to American companies. Because capital markets are forward-looking, this is sign that investors have zero confidence in Obama and his plan to rescue our economy, as we reported here.
As Michelle Malkin states, this is more than a collapse, this an Obama Cliff Dive, folks.
See video of the “Buy” rating below:
Obama Buy Rating
March 10th, 2009 at 11:57 am
This whole blog post was hog wash. The DOW is up 340 today in the closing moments of trading. I’m not directly attributing that single day of movement to Obama nor should you attribute the 300 point decline to him. Please collect more data points before passing judgment.
Does anyone here really think the markets won’t rebound at some point in the next year to something around 8000? How are you not going to end up with egg on your face with fickle stories like this?
March 10th, 2009 at 5:30 pm
I have just one question how much did the government spend in 2008. I just want to know this. So can anyone tell me, because I can’t find this online.
March 11th, 2009 at 4:46 am
That’s a good question. I can find the budget…
http://en.wikipedia.org/wiki/United_States_federal_budget,_2008
…but as you know, that doesn’t include the wars and end of year bailout money, it has several dubious accounting tactics, and there’s always a supplemental passed each year.
March 12th, 2009 at 12:50 pm
Ignatius, and now the market has made up that deficit and is several points higher than when Obama made the comment. Does it means that we are out of the woods? Of course not. It just shows how willing you are to pounce on bad news.
In 2001 I gave Bush a chance and a fresh start in 2005. I let him do things that proved (in my mind) to be asinine before giving up on him. You have never given Obama that chance. It’s only been 50 days and stores like this are not warranted.
March 12th, 2009 at 12:51 pm
Sorry, I meant “several hundred points higher”
March 18th, 2009 at 10:45 am
The day this story was posted, the DOW closed at 6,547.05. It is now over 7,500 (market has not yet closed).
WHERE IS THE FOLLOW-UP STORY STATING THAT OBAMA GOT THE “BUY” RATING CORRECT? The DOW is up 1,000 points since the story was posted.
I’m not saying we’re out of the woods. I’m not saying Obama had anything to do with the decline or the rebound or that the rebound will continue.
I AM ASKING WHERE IS THE ACCOUNTABILITY FOR TELLING BOTH SIDES OF THE STORY??
March 18th, 2009 at 11:05 am
Rob L, you are wrong. On the day that Obama said “buy” the market was over 6800. After he said “buy” it dropped to 6547.05. Yes, the market is up over 700 points since then. But “buy” ratings have an immediate effect on the markets. Not a fall to 12-year lows followed by a recovery.
The markets will fluctuate for a while, so this by no means is an indication that Obama was right.
And note Obama said “long-term.” If you think 10 days constitutes “long-term” then you obviously don’t have any clue about how markets work.
March 19th, 2009 at 7:34 am
You’re in such a weak position, surely there is *something* you can concede so you don’t look completely incapable of reporting the truth.
If what you say is true: “But “buy” ratings have an immediate effect on the markets.” then the FACT that on the day he said “buy” the DOW went up 150 points is striking. Personally I don’t credit either the immediate climb or fall to Obama at all. The message was for the general public, not investors. So your parallel was weak to start with.
Let’s skip the nuance B.S. Your article said things like “stocks have crashed in an unprecedented fashion under the Obama administration”, “this is sign that investors have zero confidence in Obama and his plan to rescue our economy”, and “this an Obama Cliff Dive, folks.”
But just 2 weeks later, the Nasdaq is UP since Obama took office and the DOW is within a few hundred points of where it stood at the start of his first full day. Where’s the story saying, oh, all that “zero confidence” and “Obama Cliff Dive” stuff I repeatedly went on about, well I went a little over the top. Even a comment stating, “I honestly didn’t think we’d have any sort of recovery so quickly” would be nice (leaving open the markets could plunge again).
The true outcome of this story is that Obama said “buy” and you would have made a ton of money if you had listened.
Also… come on… if you know anything about markets then you know a rebound is typical no matter who is President so long as they don’t do obviously unjustifiable things.
March 19th, 2009 at 8:21 am
Rob L, Obama said “buy” the day after the markets dropped 400 points over 2 days. Stocks always rebound a bit after dramatic falls (the collapse came after he announced his budget plan). It gained a tiny bit of that back. Then, it proceeded to collapse again. Now it’s rebounding. Point is, if people had any confidence in Obama, we’d see a rise in the markets that goes beyond mere fluctuation. We’re now going downward again, so your point is moot.
You’re picking a convenient point at which to say “Gotcha” and it’s not working. Buying stock under Obama has been a terrible investment.
March 19th, 2009 at 11:46 am
First of all, from your other posts “lying” and “tirades”. Uh… hyperbole much?
Let’s not go around and around on the short-term thing. You’re determined to mash Obama’s words into a short-term vote of confidence in order to fit your other observations. Have fun with that, but I don’t think you’ll be getting much traction.
As you said, his words were meant long-term. Let’s nail that down to something quantifiable. In your view, what time-span should we look at and what index numbers will constitute success/failure?