"Ready for dinner"
12:09 p.m. EDT: The Dow Jones industrial average is up 54 points on the day. Hurrah, hurrah! The crash is over. Wall Street loves Obama!
Funny, I just checked Twitter, and I’m not yet seeing an ecstatic response to this clear indication of Wall Street’s acquiescence to Obama. Instead, a search for “stock market” and “obama” reveals plenty of sore losers still crowing over how the 434-point decline in the Dow on Wednesday and Thursday proves that the president’s reelection is a disaster for the United States.
“The stock market is really going down the shitter since Obama got reelected.”
“So what about that stock market crash because Obama was reelected? We’re headed to another recession.”
“Gas lines, prices, food prices, unemployment, stock market crash, welcome to Obama’s second term.”
“Stock market already down? I’m calling everyone who voted for Obama a dumbass in my Red Foreman voice.”
Donald Trump wasted no time joining the frenzy: “The stock market and US dollar are both plunging today. Welcome to @BarackObama’s second term.” Investment adviser and notorious loon Marc Faber declared on Bloomberg TV that the market should have fallen 50 percent and investors should buy themselves “machine guns.” Fox Business News’ Stuart Varney also chimed in, calling the stock market drop a “reaction to Obama’s reelection.”
Silly, silly people. If we’re going to talk about Obama and the Dow, there is only one number that counts. Over the course of his entire presidency, the Dow Jones industrial average has risen more than 60 percent. In fact, if you start tracking from the low mark hit on March 6, 2009 — 6,469 — (about three weeks after the stimulus bill was signed into law), the Dow has more than doubled. There’s no way around it. Obama’s presidency has been very, very good for investors, for 401Ks and college funds and IRAs. For the market, another four years like the last four would be spectacular.
12:25 p.m. EDT: The Dow rises another 10 points, now up 65.10 on the day. Cries of “Four more years” ring out at the New York Stock Exchange.
There is certainly a possibility that miffed members of the 1 percent, angry about the prospect that their taxes would rise and Dodd-Frank’s regulations would actually be enforced, dumped stocks on Wednesday. There is also a chance that investors who had previously been fixated on the election suddenly woke up to the nightmare that partisan gridlock might send the economy hurtling over the fiscal cliff. But if either of these explanations are true, it just doesn’t reflect well on the acumen of American investors. First, they haven proven themselves incapable of reading the polls, and second, they don’t seem to have a good grasp of recent history.
There is zero chance that the fiscal cliff will crash the economy. There may well be a scary game of chicken as Barack Obama and John Boehner test each other to see who will blink first, and the game-playing could go right up to the last possible minute, but history tells us there will be a deal. Everybody, chill.
Instead of freaking out about what’s not going to happen, why not take a look at what’s really going on in the economy, this week? Exports are at an all-time peak, and as of Friday morning, wholesale inventory levels have risen so high that Macroeconomic Advisers revised their estimate of third-quarter GDP group to a perfectly healthy 3.2 percent, suggesting that the economy is currently growing at its fastest pace all year. Not uncoincidentally, consumer confidence is at post-2007 high. We may see some Hurricane Sandy-related economic blips in the next couple of months, but the underlying economic trend points toward a more healthy economic recovery than anything we’ve seen in the previous four years. And that’s going to be very, very good for U.S. stocks. If you sold early this week, out of pique at Obama’s reelection, you probably screwed up.
12:55 p.m. EDT: The Dow keeps rising, up another 8 points, now up 76.37 on the day. It’s a new gilded age! Buy now, or miss out on the next long boom!
1:06 p.m. EDT: The Dow drops 15 points in just 11 minutes! Sell, sell, sell! Doom is upon us. Black Friday Early Afternoon is upon us!