Bloomberg News, WSJ op-ed blame Obama for stock drop, ignore longer-term trend
SUMMARY: 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.
Why does every financial manager say that the important thing is the long term trend? Don't be short sighted.
The trend for more than a year has been downward. To blame any president after two months in office is just ridiculous. If we're going to place blame now and ignore the long term trend, why not blame those who are working to see that this president fails?
Are you surprised? The party of personal responsiblity* never takes responsibility for it's messes. It's always someone elses fault.
*DISCLAIMER: While Snoopy periodically uses republican, for all practical purposes republican refers only to elected officials. Also, it is the belief of Snoopy that with the exception of 3 senators and a handful of congressmen who red staters refer to as RINO's all the elected officials are part of the right wing nut machine. If Snoopy should interchange between "republican" and "right wing republican" rest assured he is directing his comments at the right wing who have ruined this country. This disclaimer was bought to you to clear up any perceptions promoted by the obtuse.
So how long do you give Obama before you start to blame him? How many times do his proposals have to drive the Dow down 300 points before its him? How many times does he hand picked tax cheat get to throw markets around the world down before it is fair to blame him?
Disclamer. I know this post is going to make snoopy call me a nazi. Anyone who does not agree with him has a desire to kill millions of people. Dont blame snoopy though, he is simply a dumb mutt.
I would give him at least 8 years. Noone has blamed Bush for this yet. At least not the republicans.
The funny thing is that if you look at reality it takes time for the market to pick up after a fall of as much as we had last year alone. The down trend is harder to reverse than the up trend. Give President Obama at least 2 years and stop fighting what works from history with what fails and let it work.
I'm not really concerned about the stock market. It's not an indicator of how society is doing. Low income and middle class people were doing awful under Bush and yet the Dow was soaring to new heights.
The market might be reacting to the dismal unemployment figures or to the unavailability of credit.
Maybe they're reacting to all of the hot air about failure coming from wingnut central.
Or maybe they're still reacting to the untold trillions of dollars in fake investments, packaged and sold by the unregulated thieves on Wall Street, that have yet to hit the market. Everyone knows it's out there. And Obama had nothing at all to do with it.
"So how long do you give Obama before you start to blame him?"
Wait until Barack Obama actually does something that creates an economic crisis. The question should be, when does the damage Republicans caused end?
"How many times do his proposals have to drive the Dow down 300 points before its him?"
So what you are saying that every time the markets go down it is only because of what happened that day and Obama's present proposals and the new laws that have just passed. You are saying that the the markets tanking has nothing to do with the housing crisis, the banking crisis, and the layoffs. All of which Obama had nothing to do with. There were already signs of a major crisis back in late 2007, and everyone knew for sure by Oct. of 2008, that the economy was in huge trouble and it was going to a very long time before the economy is going to see solid sustained positive numbers. Obama has never promised for the layoffs, foreclosures, and bank troubles to stop. What the stimulus package does is soften the blow to America that Republicans caused.
We need to establish some sort of a standard here.
Sept 11, 2001 - over 7 months into the Bush Administration is declared (by folks like POV) to be Clinton's fault.
March 2009 - less than 2 months into the Obama Adminstration the market crash is definitely Obama's fault (despite the fact that the market had been nose-diving for many months).
So, POV, what sounds fair to you and, remember, we will want to use this for the next GOP administration too.
YOU CANT LET THE UNSTABLE RUN THE ASYLUM. THE MARKET IS THE ASYLUM AND THOSE RUNNING IT ARE UNSTABLE IF THEY INSTITUTED THE R I C O ACT ON THE FRAUD CORRUPTION COLLUSSION AND A HOST OF FEDERAL CHARGES WALL ST WOULD BECOME A GHOST TOWN. EVEN CAPITALISM HAS ITS LIMITS. ITS A DISGRACE TO THOSE IN THE WALL ST FAMILY AND THOSE OVERSEEING IT TO HAVE IT TAKE DOWN THE WHOLE FINANCIAL SYSTEM. AS LONG AS THEY REMAIN IN CHARGE THEY WILL SYSTEMATICALLY DESTROY OBAMA BEFORE HE DESTROYS THEM . JOE CAPRIO
Actually I think the DJIA is now accurately reflecting to eight year cost of the Iraq war.Remember Obama saying not adding the cort of the war is dishones economics. For mr obama and his team to make decisions beneficial to the nation regaing its GDP, they need to take into account all the things that drain the treasury.
Did anyone see Jon Stewart pound CNBC for this? They showed a few trends in the DOW, and noted that on Reagan's inaugural day the DOW went down, and then when we won WWII the DOW went down, and on the day the Titanic sunk, the DOWN went up.
And those idiots at CNBC, making very bad predictions about companies, saying "stay with them" and then they crash not too much later.
http://www.huffingtonpost.com/2009/03/05/jon-stewart-eviscerates-c_n_172057.html
Unfortunately it does not have the 2nd half of the program, evicerating the idea that Obama is causing the stock market to fall, and that the stock market is THE only factor in measuring the economy.
Our economy still isn't and hasn't been as robust since the 2001 recession.
A little known fact here and maybe forgotten is that the way they measured the DJIA was different in reagan's time from what it is now. They have cjanged the companies that make up the DOW.
You know, it seems ironic that the president can have 60%+ approval ratings and have polls showing that Americans trust him on the economy, yet people say that the Dow dropping is proof that Americans and investors aren't confident in him.
Even if such a thing were true, which, judging from past DOW cycles, it isn't, then wouldn't show how true it is that 10% or less of the world's people own 90% or more of the world's wealth?
The big investors do not trust him because he wants to expand the middle class and this will hurt them.
The big investors in this case are those that invest jobs in foreign countries and not pay US taxes. If by hurting them you mean making them pay US taxes you might be correct and i ask, what is wrong with investing in your own country ?
The big investors and other coserivitves fear a strong middle class because they will not be aboe to abuse us and they will not be able to control the government wikth their greed.
The decline in the DOW has accelerated since Obama took office. It is a continuing downward trend but it has gotten much worse in the past few months. MMFA should acknowledge that.
You are actually full of Mathews bologna.the chart Mathews showed the other day day starts on election night, when GW Bush was still president until Jan 20. That is close to 3/4 of the chart. get out of the bunker and smell the roses for Mathews is being very dishonest here. Decline is accelerated means a rate of change of the rate of chenge. second derivative and that is not the case. Pres Obama also considers the Iraq War as an expense, something the previous president did not do.
If you look at historical trends this was more likely than not to happen even in McCain won. Look at history the market looses money in the faster at the end of its part of the decline than in the beginning or middle.
This post is correct and the facts are verifiable by anyone will do so simple research and use a hand calculator. The DOW has declined at a daily rate of 28+ points since Jan. 20, 2009 up to March 6, 2009.
Whoever has been in the White House since Jan 20 has to take responsibility for that. The decline in the DOW and the other average since inauguration date can fairly be called The Obama Bear Market
As I wrote on another thread, this is the new GOP talking point. The idea is to infer that everytime Obama or Geithner speak on the economy, the market tanks.
That might work for the GOP if Americans had a positive view of the financial industry, but they do not. Wall Street knows that the gravy train has come to an end. I think Republicans can do much better with their propaganda, but, hey, keep it coming. It just shows how out of touch with mainstream America that party truly is.