What’s interesting about the Dow and the housing bubble (entwined for sure) is that most everyone agreed that housing prices were out of control and that the Dow was way overvalued. So how did folks expect this to correct without both coming tumbling down in a painful way? Did they think the markets would self-correct without loosing any value? That simply makes NO sense.
It’s certainly unfortunate the Obama was holding the hot potato when it happened, and you can argue that his policy of not “playing to Wall Street” hastened the correction in the markets… but still… it was going to happen at some point regardless of who won in November.
Where Obama can make his mark is how he guides us to recovery. He’s thrown in his lot with the Keynesians and that’s all well and good… if it works. That school of thought thinks big public spending will correct what ails us and that takes time to work so we’ll have to wait and see.
I actually welcome a President who isn’t being a slave to the markets… The White House should do what’s best for everyone, not just do what’s going to keep the Dow (artificially) high. It stands to reason that true prosperity begets wall street prosperity. A high Dow number based on credit swaps, debt bundles and paper pushing isn’t a strategy to long term prosperity for America, clearly.
GIVE IT SOME TIME TO WORK PEOPLE!
Then again, I’m about the farthest thing from an Economist so what do I know. I make pretty pictures for a living.
