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Massachusetts Liberal

Observations on politics, the media and life in Massachusetts and beyond from the left side of the road.

Wednesday, March 11, 2009

These are the fiscal experts?

Day after day, hour after hour the conservative commentariat is trying to hang the economic nightmare on Barack Obama. They argue that Wall Street (the men and men who got us into this mess) don't have confidence in the Obama plan as exemplified by the steep dive in the stock market since Jan. 20.

Explain this please.

Citigroup is reporting a strong fiscal quarter, nay an actual profit. Leaving aside for the moment the question of whether it was taxpayer money flowing into their coffers and staying there instead of going back out in loans, how did this happen all of a sudden?

Was it a result of the money spent on front page ads in the New York Times and full-page ads elsewhere? Solid business decisions in a vibrant world economic market?

Citigroup CEO Vikram Pandit offered this vague answer:
He said the bank was profitable through January and February, when it generated a combined $19 billion in revenue thanks to strong trading results and fatter lending margins.
The stock market, the excellent barometer on Obama policies, reacted like a kid on a sugar fix after Halloween.
“We poor investors, we don’t need much to make us happy, we’ve been beat up so hard,” said Ed Yardeni, president of Yardeni Research. “At this point we’ll take whatever we can get.”
Yep, a few pieces of candy after a bag full of apples and razor blades.

The market is a barometer of nothing more than the bipolar nature of traders who are out for a buck. It does not offer political analysis, despite Obama's comparison of the Dow Jones to a daily tracking poll -- which by the way has better margins of error.

The GOP's efforts to use the Dow Jones as a political poll is just more of the no-new ideas campaign from "leaders" who have forgotten how to lead.

But how Citigroup could actually turn a profit, even a tiny one, and send the stock market soaring for a day, suggests how we make a huge mistake if we rely on the "expertise" of the folks who got us to where we are now in the first place.

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