The week started off with Scott Brown pulling off the political upset of the century, then fears about China tightening kicked in, so commodities and materials got demolished. On Wednesday,Obama gave political populism new meaning with his strongly worded threat to the financial sector, against the best advice of Geithner and Summers,which was really viewed as a threat to any entity that trades publicly. The market has been in a state of free fall ever since, roughly a 500 point fall in the DOW since the speech—-so far. People may hate banks, but they love their 401K’s more, I guess Washington doesn’t understand how the stock market really works. As Jamie Dimon said last week, and it was the title of last weeks post. “people don’t care if we fail, as long as it doesn’t hurt them.” Well, this week it hurt them. A comment evidently lost on this administration.
Gridlock is considered a good thing by the market, uncertainty is not. Late in the week we found out that Bernanke may now have a helluva time getting reappointed. This also weighed on the market. You may love him or hate him, but he is still “our Ben”, and the devil you know is usually better than the one you don’t.
The bears have been waiting ten months for a catalyst, they got what they were looking for in spades. Courtesy of the White House. The next support on the S&P is 1080-1090, let’s see if it can hold. Enjoy the links.
Buffet doesn’t get it either and asks if Congress should be taxed for letting Fannie and Freddie fail.
What are the real risks of proprietary trading?
Populist positioning, Bernanke is now in trouble.
Is this the big one?
Goldman private? It’s was one of my 2010 predictions. I honestly don’t see why they wouldn’t.
Why mortgage modification isn’t working.
Mort Zuckerman on the great recession.
Is Obama killing America by killing Wall Street?
I’ve been short Russia since the new year began. I’m holding.
Bloomberg-77% of investors think Obama is anti bisiness.
$600 million goes to hedge funds in December.
Whitney Tilson is very short the home builders. I like it.
Geithner’s love of bailouts.
Let the real healing in Haiti begin, the Scientologists have arrived.
Oops.
Government intervention and the Great Depression.
Soda Pop
More on Enron the play from Bethany McLean.
The next Bill Gates.
Conan’s contract points that you might not know about.
Afghan bribes equal one quarter of its GDP.
Taxis go green in Dallas.