Fact is, that the crash was the Palin crash. All hell broke loose in the markets when Palin was announced. Just follow the time line. The very thought that that dumb bimbo could be president set off the selling, and any experienced trader knows that the final 25 to 30% of the selling is only a reaction to the first 25 to 30% of the selling as the market overshoots when redemptions, and death debt spirals begin on companies out of fear. You have to look at he source of the fear, what begot the fear, and in this case, the biggest fear on Wall Street (who overwhelmingly supported Obama) was the thought of Palin possibly becoming president. Just pull up a chart of the market and Palin, her nomination, and then the vetting process after the fact and all the scandals and her nearly retarded responses in the select interviews she did. The was the bitch that broke the dyke...so to speak.
Why? This thread is called "The Obama crash". There was no crash in May, June, July or August. The market was drifting sideways with a slight downward bias merely continuing the trend that started in October 2007. Dow was at 12,000 in the middle of March and 11,500 six months later in early September. Hardly a crash by any stretch of imagination. In fact Obama's "stock" on Intrade and his numbers in polls were dropping throughout July, August and early September, McCain was catching up fast and it did nothing to help the market. The market crashed in the middle of September at the height of McCain/Palin's post convention bounce, when Obama was at his lowest point. It crashed on the news of Lehman's bankruptcy and AIG collapse, certainly not on Obama's imminent victory.
Mccain ran an optimal campaign, and even had a good chance of winning. Then came this so called 'black swan' (AIG fannie, freddie blowup, plus stock market crash) and Obama's poll numbers began to surge.
After a double term president there is a pattern of late second term sell off. It is just a natural reaction due to the unknown changes to be made by a new president. Look at 1987, 2000, 2008. All these sell offs have many issues but with the same undercurrent, administration change. What is important is the degree of the sell off. This current sell off is less due to an excessive run up then it is due to total fear of a new administration. It may have been McCain that caused the beginning of the sell off but it is Obama causing this total panic.
Fact is, that the crash was the Palin crash. All hell broke loose in the markets when Palin was announced. ================================= Z, good one.
Can you tell me how exactly this is the "Obama Crash". This crash has been led by the financial sector, which topped out and entered a bear market before Obama even won in Iowa. This crash has as much to do with Obama as you do with intelligence.
Originally it was thought that Obama would be bad for the markets becuase he would tighten the money supply, impose trade regulation, and raise taxes, but now I am actually pleasently surprised that Obama is addopting a neocon deficit spending agenda, which is good for stocks. Obama oddly enough could be a continuation of George Bush.
================== You may be right Merc. Actually , dont think any President can do much to get out of a bear market, but could cause some uptick bear rallys. Even Ann Coulter, in her thoughtful column did not claim that. Think the new US sec treasurer, [a former republican ,NY Fed head is a good choice];but would not blame or give him credit for the bear rally, it was about time for one ayway. TN banker & former TN Rep Larry Bates; said he wished he had time to educate Mr McCain & Mr B Hussein concerning economics. Then called President Bush comments on Islam being a religion of peace''pandering for votes''
Not likely, but it would be fun to hear the extreme whining, wailing, and gnashing of the MS media teeth if it were so. Of course they would instantly turn on him...or not (wouldn't be PC)...which would make it even more fun. How could they overcome their own PC and egos to turn on their hero if he morphed into Bush?