CNBC: The MSNBC Business Channel

06 November 2008

Obama Market Collapse: Day Two


Post-Election Fears Drive Worst Two-Day Drop In 21 Years

Once again, the
markets are panicked over an Obama presidency and instead of being honest about the cause, the MSNBC Business Channel is making excuses for their Dear Leader.

With the markets having just posted their worst two-day drop in 21 years, investors might expect some honest commentary from CNBC's anchors, but instead, Maria Bartiromo and friends actually wondered aloud what potential solutions to the crisis Obama might offer tomorrow.

How could anyone at NBC believe we are this stupid? What in the world does Obama know about the economy? Not a damn thing.

Only Art Cashin offered an honest take on the situation, saying early this morning from the trading floor that Obama's anti-free market, post-election rhetoric matched that on the campaign trail, unnerving investors.

On today's show, Rush Limbaugh referenced this:

RUSH: It was CNN. CNN Money said that there will be no recession and no depression now because Obama won -- and that took, what 24 hours? We predicted it. We predicted it right here on the EIB Network. Amazing, how the economy all of a sudden, "Oh, it's not that big a deal, not that big a problem." Well, it is. The Dow Jones Industrial Average down over 790 points since Obama won.

He hasn't even passed anything yet. The truth about this is, the markets work six to nine months ahead. Everybody in the market is trying to figure out where we're going to be six to nine months ahead. They're selling and they're getting out. That 4,000-point drop, that was also due to Obama. In fact, let's go sound bite number one before we get to Carl Cameron here. This was on CNBC this morning in the Squawk Box show and something they call The Bond Report. Andrew Sorkin from the New York Times, UBS Financial Services director Art Cashin spoke about the Obama transition. The New York Times guy says, "Why wasn't Obama's attitude toward Wall Street vs. Main Street already baked into the cake? I mean, there's an expectation Obama was going to win. There's an compensation he's talking about Main Street and Wall Street as though they're two separate things for a very, very long time."

CASHIN: It's one thing to be campaign rhetoric; you can understand that. Both of them were talking on a populist vein. But now we're getting in there; we're going to be talk about specific packages. I think the market said, "Holy smoke! The campaign's over and we're still talking like that, so what does that mean as far as opinions and ideology where it's going?" Nothing was baked into that cake.

RUSH: So basically here, the market sell-off is Obama fear-based. There's no question. I know some of the economic numbers continue to be bad, but CNN money says, "No, no, no. There's no recession. There's no depression! Everything's fine."

Apparently, traders expected
a new, magic, pro-business Obama to emerge after the votes were counted. Talk by Dems of eliminating retirement plans such the 401k has also spooked them.

Baking that cake is painful indeed, with 1000 additional Dow points subtracted after the pre-election declines caused by Barack's surging poll numbers.

At 5:07pm, CNBC Fast Money co-host Pete Najarian actually had the nerve to claim Obama's policies would not be based on "tax-and-spend" liberalism.

But CNBC is not alone: other media sources blamed the tanking markets on a number of economic factors that were factored into prices long ago. One particularly moronic point: that falling oil prices were contributing to the slide. Perhaps that's hitting oil companies, but it's helping the rest of the economy.

How do you even model equity valuations under a socialist administration? We've never been there before, nor did we believe it could ever occur in the US.

Amazingly, while Keith Olbermann's business network covers for Obama, even the Barack-friendly AP has begun to admit his policies are scaring the markets. From a report after yesterday's tumble:

Stocks plunge as investors ponder Obama presidency


NEW YORK (AP) — A case of post-election nerves has sent stocks plunging as investors, again anxious about a recession, are wondering what impact a Barack Obama presidency will have on business and the overall economy. Volatility has returned on Wall Street, with the Dow Jones industrials falling 486 points to the 9,139 level, and all the major indexes tumbling more than 5 percent.

The market was expected to give back some gains after a six-day runup that lifted the Standard & Poor's 500 index more than 18 percent. But investors lost some of their confidence about the economy and began dumping stocks again; light volume helped exaggerate the price swings, and there was more late-day selling by hedge funds.

Analysts said the market is also growing anxious about whom Obama selects as the next Treasury Secretary, as well as whom he picks for other Cabinet positions.

With Wall Street bracing for the worst from Obama's far-left policies, who knows where the bottom might be?

And yet, the same network which spread economic doom-and-gloom when there was a chance McCain might win the election, now has to cover for the fact that all of this was about Obama from the start.

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