Conservative media have long made a habit of bogus stock market analysis that furthers the right-wing agenda rather than shedding light on the business world, crediting right-wing figures and causes for gains, and blaming progressives for market declines, even in the face of evidence to the contrary.
Market increases? Conservatives did it; Market drop? Blame Obama and Dems
Right-wing media figures have repeatedly attributed stock market gains to Republicans or to news that is favorable to conservative causes. Conversely, stock market decreases have been pinned on President Obama, Democrats, and progressive causes. Media conservatives frequently offer these analyses in the face of contradictory evidence.
Varney suggests Dow increased due to excitement about "Republicans sweeping in November." On the August 2 edition of Fox Business' Varney & Co., Stuart Varney and Nicole Petallides discussed why "the Dow is rallying." After Petallides attributed early gains in the Dow Jones Industrial Average that day to a variety of factors, Varney asked, "What about the Republicans sweeping in November and restoring economic sanity to the United States of America?" In response, Petallides stated: "That's been plenty of the talk over the month of July, and if you notice the month of July's performance, with the averages up 7 percent, was our best month in over a year." From the August 2 edition of Fox Business' Varney & Co.:
PETALLIDES: We're really taking our cue, obviously, from Asia and Europe this morning. We've gotten great numbers from HSBC -- they more than doubled their net profit for the first half of the year -- as well as BNP Paribas. So, coming off of a great month for us here in the States, the S&P gained 6.9 percent, but for today, you have some of European stocks hitting three-month highs, as well as copper, Asia doing well. And so we're taking it with that. And we've also gotten some great numbers ourselves, for our own earnings reports, Stuart.
VARNEY: That's it? It's all Europe, HSBC? That's what it is? What about the Republicans sweeping in November and restoring economic sanity to the United States of America? Not talking about that?
PETALLIDES: Well, that's been plenty of the talk, and that's been plenty of the talk over the month of July, and if you notice the month of July's performance, with the averages up 7 percent, was our best month in over a year. So they still continue to talk about that, Stuart. That's something that they talk about here every day.
VARNEY: Excellent. And the Dow is up 114 points.
In a later segment of Varney & Co., Fox News' Alan Colmes challenged Varney's suggestion that the day's increases were attributable to excitement about "Republicans sweeping in November," asking "Can you explain then why has the market been up consistently since Obama's been in office?" Varney did not respond to Colmes' question.
Fox & Friends suggests financial reform to blame for stock market drop. On the May 21 edition of Fox & Friends, co-hosts Gretchen Carlson and Steve Doocy associated the passage of financial reform with downturns in Asian and European markets and in Dow futures. Carlson said, "[A]t first blush, the markets don't like it at all. The Senate passed the president's financial reform bill last night. This morning, Dow futures down 3. European markets are off about 20 and the Asian markets are down about 10." Doocy later added, "In a late night session, the U.S. Senate has approved an historic crackdown on financial reform. And so far this morning, the markets haven't really reacted positively to it. The Dow futures are down about 10. European markets are off about 1 1/2 percent and the Asian markets already closed down a little better than 2 percent because of the sell off here in the United States yesterday." Guest Varney disagreed, saying, "The big decline in the stock market, 1,000 points down, by the way, in a couple of weeks, that's everything to do with the American situation that is a slow recovery with no jobs, some say the failure of Obama's economic policies, and Europe, collapse in Europe, chaos in Europe. This financial regulation reform bill, that really hasn't had that big an impact on the stock market. It's not about that."
Varney claims May stock market drop that was caused by a trade error indicated the "failure of the European model." On the May 6 edition of Fox News' Special Report with Bret Baier, Varney explained that a drop in the Dow was caused when a trader mistakenly placed a sell order for 16 billion, rather than 16 million, shares. Varney went on, "But, Bret, do not make the mistake of thinking that this was all just an unfortunate error, an unfortunate human mistake. The underlying cause is much more serious. ... You could say that today we saw the failure of the European model. High taxes, cradle-to-grave financial security and entitlement programs, and the government dominating the economy, that model is now failing."
Hannity and Morris agree that Obama's election success to blame for market downturn. On the November 6, 2008, edition of Fox News' Hannity & Colmes, Dick Morris said, "Now, the other thing that I predicted in Fleeced is that the stock market would go crazy after he [Obama] was elected. Not just because he's a radical, not just because he's a Democrat, but because he's going to raise the capital gains tax." Hannity replied, "So look what's happening," adding, "If he doesn't come out and say 'I'm not going to, you know, raise the capital gains tax, I'm not going to raise taxes,' but heading into an economic slowdown, you're predicting the stock market is going to -- it's the Obama tanking?" Morris replied: "It's going to continue to tank. It's lost 12 percent of its value in the last two days." But analysts -- including several who appeared on Fox News and Fox Business -- disagreed, citing weak corporate reports and the release of unemployment statistics to explain the decline.
Limbaugh also blames Obama's election for market losses. Also on November 6, 2008, Rush Limbaugh asserted on his radio show: "OK, so let me start at the top here connecting the dots. On Tuesday we elect a new president. New president promised even before the election, by the way, when we had a 4,000-point drop -- the president promised to increase corporate taxes, capital gains taxes, the top marginal income tax rate, a massive new energy tax that'll bankrupt coal. And his party is talking about a government takeover of 401(k) plans." Limbaugh continued: "So on Wednesday, the Dow drops about 486 points. It's down 346 points today. But of course, according to the drive-bys, these two events have nothing to do with each other. It's just a coincidence. The market's down today because of the jobless numbers. That's how the drive-bys see it. We have the largest market plunge after an election in history. Thank you, man-child Barack Obama."
Cavuto, Barnes and Glick claim Rove resignation would be a loss for Wall Street. On the August 13, 2007, edition of Fox News' Your World with Neil Cavuto, host Neil Cavuto asked Weekly Standard executive editor Fred Barnes and Fox News' director of business news at the time, Alexis Glick, whether Karl Rove's resignation as senior White House adviser would bring a Wall Street loss. Glick answered, "You know, I think we are going to miss him, because -- let's put it in context. He has orchestrated some of the best recoveries in the economy with President Bush." Barnes said, "Oh, I think they [Wall Street] do lose a key ally. Look, we're -- Karl Rove is not replaceable. He really is one of a kind, and he did play a key role in the tax cuts, particularly the 2003 ones that reduced that rate on dividends and capital gains to 15 percent."
Bulls & Bears commentators pin down markets on Obama, credit up markets to tea party. Weeks after asking if the Dow's then-downward trend was President Obama's "bear market," host Brenda Buttner opened the April 18, 2009, edition of Fox News' Bulls & Bears by saying, "Call it a tea party rally. Wall Street's sure partying, up six weeks in a row. The bulls came out about the same time these guys started to shout, saying no to big government, big taxes, and big bailouts. Will that keep investors saying yes to stocks?" On-screen text during the program read, "Stocks Rally As 'Tea Party' Rallies Take Nation By Storm" and "Stocks Rally As 'Tea Parties' Catch Fire; Coincidence?"
Limbaugh credits Obama's trip abroad for market jump, blames market downturn on Obama's return to the U.S. On the April 7, 2009, edition of his show, Limbaugh explained a 166-point drop in the Dow, saying, "It's 'cause Obama's coming home. Remember when Obama left the market skyrocketed. The markets know Obama's coming back and so the markets are plummeting." Limbaugh's comments come after he said on April 2, 2009, "I mean the market's going nuts and the only thing here that's different is that Obama's gone."
Cavuto says a Barron's article predicting GOP mid-term victory is "a possible reason for the uptick" in the stock market. On the October 23, 2006, edition of Your World with Neil Cavuto, Cavuto said, "Now to what was happening today and a possible reason for the uptick, dramatic as it was today. Jim McTague, the Washington bureau chief for Barron's, as he typically does, creating waves with a cover story that presented this bit of lunacy -- that the Republicans hold on to the House, hold on to the Senate."
Right-wing media suggest market performance a good judge of policy; experts disagree. After President Obama's January 21 proposal to limit banks' size and risk-taking, conservative figures used a coinciding stock market dip to criticize Obama on the economy. Newt Gingrich said on the January 25 edition of On the Record with Greta Van Susteren that "[t]his administration has spent a year trying to figure out there's a socialist model for running America. The recent -- most recent experiment was the demagogic attack on the banks last week, which led to the worst drop in the stock market since March of last year." On the January 24 edition of Fox News' America's News HQ, correspondent Brenda Buttner said of Obama's bank regulation proposal, "If you measure stock market value -- is the very day he came out with this, Bank of America down 9 percent. I mean, billions were wiped out of the market just by mentioning this. If we get more details, who knows what will happen." Right-wing radio hosts Jim Quinn and Neal Boortz made similar remarks. However, economic and financial experts said that a decline in financial stocks was not an indication that regulation was ill-advised. They also stated that stock market fluctuations did not necessarily represent the broader health of the economy. Economist Dean Baker wrote in a January 24 blog post that "[e]quating financial stability with the stock market's performance is incredibly irresponsible." Daniel Gross wrote in his June 4, 2009, Slate Moneybox column that "the notion that the market is telling us something -- anything -- ultimately rests on the erroneous assumption that financial markets represent the collective wisdom of rational actors processing information efficiently." Gross added: "There are plenty of cool-minded forward-thinking investors in the markets. But there are also a lot of lunatics, fools, sharks, widows and orphans, government actors with ulterior motives, algorithmic traders, greedy speculators, and whack jobs."
Hannity uses market to criticize Obama, ignores positive market performance. On the May 1, 2009, edition of his Fox News show, Sean Hannity denied the rising value of the market as an economic indicator, answering a question from Alexis Glick by saying, "The market doesn't mean anything to me. ... Alexis, you're the first person to tell people don't look at the market unless you're in it for five or 10 years, right? All right, so we're not looking at the market." However, Hannity previously used poor market performance to criticize Obama on economics. On the March 5, 2009, edition of his show, Hannity said, "If they had so much faith and confidence in his plan -- because, remember, markets don't react emotionally. Markets react to numbers." Hannity then added, "If they had faith and hope in his plan, why wouldn't they react more confidently?"
Beck says prediction that Brown's Senate victory would bring a market rally "made total sense." On the January 20 edition of his radio show, Glenn Beck discussed a prediction by CNBC's Jim Cramer that a victory for Republican Scott Brown in the Massachusetts Senate race could lead to a "gigantic rally" in the stock market. Instead, the Dow dropped significantly the day after Brown was elected. Beck stated, "I'm not sure why it's coming down. I mean, Jim Cramer was on, what? Two days ago? And he said that it would go through the roof and it made total sense to me. I don't know why. I can't tell you."
Frequent Fox guest Hoenig's warmongering market analysis
Your World guest Hoenig asserts that a pre-emptive attack on North Korea would cause a market rise. On the July 10, 2006, edition of Your World with Neil Cavuto, when asked about the market effects of a pre-emptive strike on North Korea, Jonathan Hoenig, managing member of Capitalistpig Asset Management LLC, answered: "I think the market rises. I would love to see us launch a pre-emptive attack on North Korea." Hoenig's comments followed his June 19, 2006, appearance on Your World, in which he advocated action against North Korea to prevent a sell-off, saying, "We should take preventative action here and take out their capacity to threaten us. I think that's when you are going to see this market take the North Korean threat off the table. Right now, I'm scared that this could become a real threat and a catalyst for a major sell-off on Wall Street."
Hoenig: "[I]f you want to see the Dow go up," bomb Iran. Also on Your World, Hoenig predicted that attacking Iran would lead to a stock market increase. From the June 5, 2006, edition of Your World:
HOENIG: I think when it comes to Iran, the problem is we haven't been forceful enough. I mean if you -- frankly, if you want to see the Dow go up, let's get the bombers in the air and neutralize this Iranian threat. We've gone to the negotiating table, we have danced around with these people. That's not going to help this country nor the stock market.
Hoenig: If Moussaoui is not executed, stock market will suffer. On the April 12, 2006, edition of Your World, Hoenig asserted that the U.S. economy would be unable to "thrive" in the event that convicted September 11 conspirator Zacarias Moussaoui was not summarily executed. "If I had my way, you'd bring him out back, put a bullet in his head, and toss him in the dumpster," Hoenig said, adding, "This is an evil monster and I just don't see how society can prosper or the economy can prosper, if this guy lives."