Obama vs. Equity Markets

A friend pointed out that we haven't heard from Ben Bernanke during this week's carnage and he has a point.

The market is testing the new administration to see how it reacts to the crisis that has ensued the past year. It is ugly and scary to see the tape and hear about the growing unemployment in the US of A, but it could be to set the bar low for a durable rally. I am currently a resounding bull because, I believe, to make money in the market you have to take the other side of the trade; obviously one has to find durable reasons for ownership.

Bank nationalization can happen but if it wasn't this fear there would be another in its place. Additionally, the US is not Europe nor Britain and one cannot extrapolate trends in different geographical areas. We have had a capitalist market since the founding of this country and its burgeoning tobacco trade and it will not stop. Granted, Obama's priorities are not focused on the market but neither was Bush's at first. And according to Paul O'Neill's book, Enron was a focus early on in the administration but O'Neill let it fail so early failures in Obama's administration isn't out of the question but neither is a sustainable rally in the economy and the equity markets.

The US is a nation of investors, savers, and gamblers. These three attributes will always provide the fuel for finance and capitalism but patience is required.

I hope this helps as we go forward.