CNBC: The MSNBC Business Channel

05 November 2008

Obama Victory Leads To Huge Sell-Off


Wall Street Not Prepared For Barack's Socialism


With CNBC following suit, the global mainstream media is doing a remarkable job covering for today's Obama-generated market collapse. As of 4pm, the Dow is down 490 points.

Instead of telling the truth, which is that Wall Street was holding out hope for an upset McCain victory, they're busy contending that Obama's victory "isn't enough" to overcome the "crumbling" economy.

Obama's socialistic policies are going to crush investors, which is why last week's huge market rally will soon become but a fond memory. With CNBC now serving as the MSNBC business channel, however, that's not an opinion you're going to hear.

In fact, CNBC even believes some sectors will fare well under Obama. Which are those, the ones he hasn't yet targeted for bankruptcy?

The International Herald Tribune, for example, believes Obama will actually cause markets to move higher in the long run:

European share prices tumbled, after a rally in Asia, as investors studied the implications of Barack Obama's election as America's 44th president.

"Obama's victory was no surprise," said Philippe Gijsels, senior equity strategist at Fortis Global Markets in Brussels. "The market will move on quickly from here."

Historically, Democratic presidents have been better for stocks than Republicans, he said, especially in their first 12 months in office, so the rally that has lifted shares recently could continue through the end of December and possibly into next year.

Nonetheless, it appears that stocks are in "a very big bear-market rally," Gijsels said, and "we're facing one of the worst global economic slowdowns we've ever seen. That's not political."

Only at the bottom of this story does CNBC mention in passing that Obama's policies might be trouble for the world economy:

"This is another, if I may use my term, 'fally', which is a rally based on fallacy … the rally of a new presidential election. Nothing is changed. The US economy is deteriorating day by day. There's no reason to rally right now," Kirby Daley, senior strategist at Newedge Group, told "Worldwide Exchange."

Obama still has to deal with a credit crunch which has not eased enough for banks to provide support to the real economy, despite three-month dollar Libor rates falling to a five-month low on Tuesday, Bob McKee, chief economist, Independent Strategy, said.

"We're getting contraction, we're getting deleveraging, and that's going to continue," McKee said. " We're going to have a really bad position for jobs, for the housing sector."

Both the new president and the new vice-president are urban people, and "that's where things are going to be sorted out", as they are much more in touch with urban issues, he added.

But Obama has been "ambiguous" on the question of free trade, and protectionist measures in the U.S. could be damaging for world growth, McKee said.

With CNBC serving as the MSNBC business channel, viewers simply can't trust its economic coverage, especially when the primary goal is defending Barack Obama's inexperience.

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