Obama Recession and Wall Street Follies: Limbaugh and Hannity Get It Wrong

Note the correct prediction (foresight instead of hindsight again) in this blog on Friday afternoon. Yes, as the Dow started straight up, I told you (for those of you who have read these blog entries on these computer driven late market moves) that the Dow was headed for another one of those 500 point moves, as the stupidest people on Earth again had a chance to reveal themselves. The stupidest people on Earth (or "market" computer gamers and evil manipulators--take your pick) are people how actually buy as the Dow is already up 200 on the way to one of those fictional 500 point moves.

Then the financial "journalists" (only competitors fro titel of "stupidest people on Earth", along with non-financial "journalists") weighed in with the false interpretation that the "market" was reacting to the announcement of Obama's proposed Secretary of The Treasury. I told you the real reason for the 500 point move on Friday. The financial "press" told you the false reason. They are dumb. I am smart(er). The real reason for the move was merely another one of those computer driven, "technical" moves--after similar declines in the last hour of the previous two days. In no real sense did the announcement of Obama's proposed Secretary of the Treasury have anything to do with the late, computer rally on Friday.

This brings us to Rush Limbaugh, Sean Hannity, and other conservatives, who are labeling the Wall Street meltdown, and economic woes, an "Obama recession, because the Dow went down further after Obama's election than after the election of ay other--certainly any other modern--President. The idea is that the stock market, and the economy, is reacting to the disastrous economic policies expected from Obama.

Hogwash. Balderdash. (Think up your own, less kind, words.). Just like the 500 point move on Friday had nothing to do with Obama (stupid "journalists" aside), it is absurd to attribute the drop after Obama's election to a rational reaction to that election.

You then have to explain why the Dow was up 18% prior to the election, in another one of those fictional moves. Was it in "anticipation" of Obama being elected? Don't be silly. It was irrational, and the decline after the election was simply a reversal of the previous irrational up move.

Now don't get me wrong here. Obama's election will be an eventual disaster for the economy, along with the election of all of those leftist Democrats to Congress. And I have no problem with Limbaugh, Hannity and the rest "spinning" "news" the way they want to spin it. The left has perfected the Big Lie ("global warming" being but one example). If Limbaugh and Hannity can plant the idea of an "Obama recession" in the mind of the public, I would ordinarily say "more power to them". The false "news" reports about the reason fro Friday's late market rise show that the idea of an "obama recession" is no more implausible than what the mainstream media--including the not worth watching Fox News--are reporting on the market.

However, Limbaugh and Hannity are doing a disservice to the country by attributing rationality to the stock market, and financial markets, at a time when such markets are irrational--and broken. Hannity and Limbaugh, by implication, are saying that the market trading is a rational reaction to Obama's election, when it is really nothing more than a continuation of the increasingly irrational, computer driven, momentum trading in our present financial markets.

This blog has given it to you straight. Something needs to be done about the irrationality--now embedded in the "system--of trading on Wall Street. For Limbaugh and Hannity to be using that trading to try to make a political point obscures than problem, and makes it more likely that no one is going to address the problem. If nothing else, if Rush Limbaugh were to call attention to the irrationality of prsent stock market trading, inclulding this blog's identification of the "stupidest people on Earth", it might actually help to mitigate the irrationality--besides calling attention to the problem.

As it is, Limbaugh and Hannity are just adding to the "journalistic" irrationality/fiction that the market acts rationally. That is a dangerous ting, and is hurting the country (the failure of anyone to identify the present problem with our financial markets having become computer gaming casinos rather than true investment vehicles).

Yes, I understand why Limbaugh and Hannity gave in to temptation on this one. Why let the left define the "Big Lies"? Why not at least spread competing "Big Lies", so that a Big Lie such as the Obama appointment of a Secretary of the Treasury being "approved" by the market is not left out there alone. In other words, why should the left be able to sell the Big Lie that Obama is having a good effect on the market, ehwn there is at least as much evidence he is having a bad effect on the market?

I understand the temptation, but I reject it. Someone has to stand for rationality here. I just wish this blog had enough influence to be more of a factor in spreading rationality. However, I can only do what I can do.

There is no reason, by the way, to celebrate Obama's choice for Secretary of the Treasury. As stated above, the stock market was not celebrating that choice, in any real sense, on Friday. To the stock market, it was irrelevant whether or not the choice was "good" or "bad" ("not good" being my vote).

Obama's choice was the chief of the New York branch of the Fed, who has supposedly worked "closely" with Paulson. If you have followed this blog, you know that working "closely" with Paulson is not a recommendation. The New York Fed was where that meeting on the AIG bailout was held--the should-be infamous meeting where Goldman Sachs (Paulson's former firm faced with a 20 billion dollar exposure to AIG) was the only private company allowed to participate.

Bottom line: The New York Fed chief was one of the people who failed to do anything to prevent us from ending up in the present situation. He has to be regarded as part of the problem, and there is no reason to believe he is part of the "solution". Presumably, if he had any great ideas, he would have put them forward long before we reached this point.

However, time will tell on his performance. Obama has made his choice, and it is unlikely to be rejected. The idea that the mere naming of such a person--already part of the system that failed--as Secretary of the Treasury gave the stock market a rational reason to go up 500 (actually more than 500 from where it was when the rally started) in the last hour is irrational in itself.--just as irrational as the idea that Obama's election is the reason the stock market went down.