WhatFinger


Growing confidence amongst investors in the economic prospects of the nation as a whole.

Obama Agenda Tanks, Stock Market Soars



After watching their 401(k), IRA, and other investments get destroyed since the economic tsunami of Oct 2008, when Dow Jones Industrial Average dropped from 11,000 plus to less than 8,500 in a little over a week, investors around the country finally have a reason to rejoice.

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From their lows in March 2009, all 3 major indices have dramatically risen: the Dow is up from 6,547 to over 9,100, the NASDAQ Composite Index rose from 1268 to just under 2000 and the S&P 500 is up 200 points to 988. While some have attributed the recent rise in stock prices to positive earnings reports, the most important factor at play is the growing confidence amongst investors in the economic prospects of the nation as a whole. Smart investors have been painfully aware that an alarming number of President Obama’s policies, including CO2 emission regulation and healthcare reform, are quite simply business killing initiatives. Should they be enacted, they would without question devalue any investment made in an American company, either with soaring energy and healthcare costs, or due to subsequent currency inflation brought on by massive government borrowing. President Obama’s first couple months in office witnessed the most prolific spending by an administration in the history of the United States including a $787 billion stimulus package that to date has created very few jobs – mostly because that wasn’t what it was designed to do; in reality it was a thinly disguised payoff to party loyalists and a financial down payment by Democrats on the next election cycle, which is why most of the stimulus spending isn’t scheduled to begin until next year - and a record setting $410 billion Omnibus Appropriations bill that contained over 8,000 earmarks. Transparency was thrown out the window and the bills were passed so quickly that most members of Congress didn't even read them before voting. The stock market reacted as expected by sinking to levels not seen in 12 years, losing millions of Americans trillions of dollars. However, centrist Democrats in Congress - who knew they still existed? - are now starting to fight back against President Obama's reckless economic policies. Although the cap and trade energy tax has yet to be voted on in the Senate, it has already become the persona non grata of the administration. Apparently regulating the gas we exhale is starting to sound ridiculous to majority of Americans, especially since global temperatures have actually been decreasing over the past 10 years - thus the new fashionable term “climate change” as opposed to “global warming.” The only mention of energy related legislation on the White House website over the past couple of weeks is a notice that Energy Secretary Steven Chu was establishing a Facebook group to personally promote green policies to American youth - hardball politics indeed! Apparently even the administration is giving up on this fools battle. Obama healthcare reform legislation is likewise looking like a lost cause: it’s way too expensive, it’s a huge political risk for centrist Democrats who don’t want to get voted out of office in the next election (there are, after all, lots of perks for being in Congress), and no one in their right mind wants to be enrolled in the public option which is looking more and more like “euthanasia for seniors” with each passing day. Speaking to an investor with over 30 years of experience, all he felt was needed to confirm that healthcare reform was going nowhere in Congress was to look at the current stock prices of health insurance companies. Obama’s desire for complete government takeover of the healthcare industry would inevitably cause these stocks to drop like a rock. After all, who would want to own stock in a business that was destined to be priced out of existence? It turns out the 2 largest health insurance companies have been doing quite well lately, especially since Obama’s uninspiring prime-time healthcare news conference last week, which even commentators on MSNBC described the President as “sleep walking” and “defeated”. WellPoint is now trading at $52, just $1 less than its 52 week high and up 5% since the healthcare news conference; UnitedHealth Group is at $28 a share, up 10% since the healthcare news conference and only $5 off its 52 week high. The smart money is betting that private health insurance is here to stay. President Obama's anti-business and investment killing initiatives have finally been thwarted, for now at least, and investors are responding by once again pouring their money back into the greatest generator of wealth on the planet, the United States of America. Let’s hope it lasts.


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Fred Dardick -- Bio and Archives

Fred Dardick got a BS in Biology at Boston University and MS in Biology at Stanford University before deciding that science bored him. He now runs a staffing company in Chicago where he is much happier now.


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