Obama’s Bear

From Bloomberg:

070511-bear-picture

‘Obama Bear Market’ Punishes Investors as Dow Slumps

March 6 (Bloomberg) — President Barack Obama now has the distinction of presiding over his own bear market.

The Dow Jones Industrial Average fell 20 percent since Inauguration Day through yesterday, the fastest drop under a newly elected president in at least 90 years, according to data compiled by Bloomberg [emphasis added]. The gauge lost 53 percent from its October 2007 record of 14,164.53, slipping 4.1 percent to 6,594.44 yesterday.

More than $1.6 trillion was erased from U.S. equities since Jan. 20 as mounting bank losses and rising unemployment convinced investors the recession is getting worse. The president is in danger of breaking a pattern in which the Dow rallied 9.8 percent on average in the 12 months after a Democrat captured the White House, according to data compiled by Bloomberg.

“People thought there would be a brief Obama rally, and that hasn’t happened,” said Uri Landesman, who oversees about $2.5 billion at ING Groep NV’s asset management unit in New York. “It speaks to the carnage that’s in the economy and the lack of confidence in the measures that have been announced.”

A bear market is defined as a decline of 20 percent or more.

Continue reading…

Back in early November 2008 I predicted to a somewhat liberal co-worker that if Obama won the election we’d see the stock market plunge. But even I am a little surprised that the plunge has been so dramatic and so unrelenting overall.

What I expect now is that we will soon see stock market losses to compare with the 90% losses of the Great Depression. Every move the federal government makes is the wrong move, but more importantly to investors,  they don’t appear to have a clear plan of action – they’re making it up and experimenting as they go along.

A crisis of confidence in government sweeps through the market like a plague. This current plague has only begun claiming victims.

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