Bloomberg News, WSJ op-ed blame Obama for stock drop, ignore longer-term trend
Research ››› ››› SARAH PAVLUS & MATT GERTZ
In a March 6 news article headline, Bloomberg referred to the "Obama Bear Market," and The Wall Street Journal ran an op-ed on the same day with the headline "Obama's Radicalism is Killing the Dow." In fact, the market has been on a decline since October 2007, and, as the Financial Times' Dan McCrum said, "it's the economy which is driving the market down here" and that "what's important is that President Obama doesn't try to address that in the short term. He's quite right that short-term market movements aren't -- shouldn't be driving government policy. What he needs to do is concentrate on fixing the economy, and the market will sort itself out."
In a March 6 article, headlined " 'Obama Bear Market' Punishes Investors as Dow Slumps," Bloomberg News reported: "President Barack Obama now has the distinction of presiding over his own bear market. The Dow Jones Industrial Average has fallen 20 percent since Inauguration Day, the fastest drop under a newly elected president in at least 90 years, according to data compiled by Bloomberg." Similarly, in a March 6 Wall Street Journal op-ed headlined "Obama's Radicalism is Killing the Dow," Michael J. Boskin, chairman of the Council of Economic Advisers under President George H.W. Bush, wrote: "It's hard not to see the continued sell-off on Wall Street and the growing fear on Main Street as a product, at least in part, of the realization that our new president's policies are designed to radically re-engineer the market-based U.S. economy, not just mitigate the recession and financial crisis." By contrast, the Financial Times' Dan McCrum stated on the March 3 edition of MSNBC Live that "it's the economy which is driving the market down here" and that "what's important is that President Obama doesn't try to address that in the short term. He's quite right that short-term market movements aren't -- shouldn't be driving government policy. What he needs to do is concentrate on fixing the economy, and the market will sort itself out."
Indeed, the Dow Jones industrial average was on a downward trajectory months before the election. Bloomberg News itself acknowledged in the article that "[t]he Dow entered its most recent bear market on July 2, 2008, when a 167-point decrease gave it a 20 percent loss from its record 14,164.53 on Oct. 9, 2007" but ignored the possibility that the current drop in the Dow was a continuation of the earlier trend:
By 7:29:05 a.m. ET on March 6, Internet gossip Matt Drudge highlighted the Bloomberg article on his website with the headline "WIRE: 'Obama Bear Market' Punishes Investors as Dow Tumbles 20% ...":
FoxNews.com also reported on March 6:
The Dow Jones Industrial Average has fallen faster under President Obama than under any new president in at least 90 years, according to a review conducted by Bloomberg.
Bloomberg reports that since Inauguration Day, the Dow has fallen 20 percent, leading at least one investor to dub this the "Obama bear market." The Dow has also dropped 31 percent since Election Day.
U.S. News and World Report's Political Bulletin subsequently highlighted Boskin's Journal op-ed under the heading "Is Obama Hurting The Stock Market?"
As Media Matters for America previously documented, during the March 3 edition of MSNBC Live, anchor Contessa Brewer stated, "Since Election Day, the Dow Jones industrial average has dropped nearly 3,000 points. It's shed a quarter of its value in just the past two months." But the Dow was on a downward trajectory months before the election, dropping 3,738 points from May 2, 2008, to November 3, 2008, and the drop did not start on Election Day, as MSNBC suggested.