Stock Dive Is Bookend Of Bush Economics

The headline from the world of politics and economics today seems fairly self-evident: in the wake of the House of Representative's failure to pass a bailout package for Wall Street, the Dow dropped by the largest point margin in any single day in history.

But that number told only half the story. Indeed, much of what transpired on Wall Street and in the halls of politics put a bookend on what now seems to the final - poor - chapter of the Bush administration's economic record.

On Monday, the Dow finished lower than when George W. Bush assumed the presidency: 10,587.59 on January 19, 2001 compared to 10,365.45 at its close on September 29, 2008.

NASDAQ, the American stock exchange, too, was lower now than it was when Bush took office: 2770.38 on January 19, 2001 compared to 1983.73 on September 29, 2008. The dollar exchange with the Euro was lower than when Bush was elected: 1.068 on January 19, 2001 compared to .695 on September 29, 2008.

Some things have risen, but not the good economic indicators. The Consumer Price Index was at 175 on January 19, 2001 and 219 by September 29, 2008. Unemployment, meanwhile, stood at 4.2 percent when Bush came into power. Today, it is at 6.1 percent.

"It's a striking phenomenon," said Robert Shapiro, undersecretary of commerce during the Clinton White House years. "The reckless negligence and mismanagement of the country's financial markets by the White House, the Treasury and the Fed over the last several years has now produced a crisis that has wiped out all of the increase in the market value of America's companies from five years of record corporate profits, strong productivity gains, and reasonable growth. Bush has now run the table on presidential failure."

UPDATE: Dean Baker, co-director of the Center for Economic and Policy Research, doesn't disagree with the idea that the economy's struggles are evidence of Bush's failure. He just doesn't think the DOW's fall is the proper measurement.

"I actually consider it a plus,' he said of the tumble. "he stock market was still in a bubble when Bush took office. there is no public interest in an over-valued stock market. We have about 20,000 real measures that we can use to show how bad the economy has performed under President
Bush, the Dow is not one of them.

Comments

[abby4ever]

If, as one CNN money analyst said, those who rejected the bill simply wanted to test the markets, to see what they would do, and if the markets shoot back up today and stabalize for a few days, I'd say the next bill has no more cvhance of passing than the one they voted on last night.

[TiffanyHusseinBanned]

Why did Rep. Boehner and Rep. Cantor lie yesterday? Why lie to the American people?

McCain’s party is full of liars.

[theplaintrutho1]

Remember, they have no other choice.

It's up to you to expose those lies.

[Pronto]

Good take on the whole mess.

http://online.wsj.com/article/SB122273257698488295.html

[TiffanyHusseinBanned]

Republican Arizona Congressman (name?) was on Morning Hoe and said Boehner and Rep. Cantor told lies yesterday.

He said no one changed their votes because of Nancy’s speech. Not one Republican congressman changed their vote due to that speech.

Boehner doesn’t have any leadership.

The Republican Party rejected GWB, McCain, Boehner, and Cantor.

The Republican Party is disarray. Poor things. LOL

[Meggie]

Time to flag superbus for the s e x i s t remark below.

[abby4ever]

It's a tr*ll, it is always saying things like that just to get a rise out of other posters. Ignore it.

[TiffanyHusseinBanned]

Don’t flag him. It’s fun to laugh at the GOPers. Their party is disarray.

They need a scapegoat. The Arizona Republican Congressman said Boehner didn’t have the votes and told lies.

Superbus can’t defend his party, so he is lashing out. Like any child would do.

See McCain singing a different tune this morning? He sees the writing on the wall.

[JoeBlough]

DOW lower than when Bush took office. Add to that Bush allowing the dollar to lose 40% of its value during the last 4 years, and it's safe to say,"We're hosed".

[Brokenduck]

I agree with Dean Baker, but the Dow has for a long time been the media's benchmark for rating the overall strength of the economy. Disconnect? Very much....but when all other numbers tend to be skewed nowadays, I just find it interesting that this is one more reason why the last eight years have been such a disaster.

Isn't the author of "Dow 36,000" one of McCain's advisers?

[Superbus]

Here's the group Obama insisted on giving 20% of the bailout money to.

THE seeds of today's financial meltdown lie in the Commu nity Reinvestment Act - a law passed in 1977 and made riskier by unwise amendments and regulatory rulings in later decades.

CRA was meant to encourage banks to make loans to high-risk borrowers, often minorities living in unstable neighborhoods. That has provided an opening to radical groups like ACORN (the Association of Community Organizations for Reform Now) to abuse the law by forcing banks to make hundreds of millions of dollars in "subprime" loans to often uncreditworthy poor and minority customers.

Courtesy Stanley Kurtz

[RnR]

what's that got to do with the fact that Paulson is salivating over 700 billion taxpayer dollars with no oversight?

We're operating in the here and now...no oversight...no money. No protection for mortgagees...no money. No paper trail...no money.

Actually I prefer an across the board "NO MONEY" :)

[Meggie]

This guy is a repub tro// looking to incite and get responses. Ignore.

[abby4ever]

The no oversight clause is a nonstarter, or should be, no one should get within ten feet of any bill that gives one man that much power. Let him salivate, he will never get it.

[Superbus]

Pennsylvania
Sept. 18, 2008, The Bulletin: Philadelphia's Family Newspaper
A community organization, with longstanding ties to Barack Obama, has, according to numerous reports, repeatedly run afoul of voter registration laws both locally and nationally. Philadelphia election officials recently accused ACORN, of filing multiple fraudulent voter registrations during the 2008 Pennsylvania primary. The case has been referred to the U.S. Attorney's office, according to Philadelphia Deputy Election Commissioner Fred Voight. Delaware County election officials have made similar allegations against the group, and criminal indictments are pending. This past July 24, Dauphin County detectives offered a $2,000 reward for information about the whereabouts of Luis R. Torres-Serrano, an ACORN worker, who was accused of submitting more than 100 fraudulent voter registrations.

[breakingnews]

often minorities living in unstable neighborhoods
(((((((((((((((
Yea, it was all those scary black people living in the hood that did this.

Newspapers around the ENTIRE world are laughing at the Rethugs for pushing this idea.

But, but then WHY did the Shrub do THIS???

http://www.whitehouse.gov/news/releases/2003/12/20031216-9.html

The truth su-cks so hard, doesnt it?? LOL!

[Meggie]

I live in a pasty white repub-majority neighborhood. It's greedy white repubs taking he foreclosure hit here. Nary a minority in sight.

[TiffanyHusseinBanned]

Black folks are behind the credit derivative crisis, Superbus?

LOL

[Superbus]

Didn't say that. It's loans to people unable to make the payments. These folks just happened to be black and Obama was in the forefront of engaging in these activities.

[Shannon2008]

So, according to you, this financial problem revolves around the fact that minorities that benefitted from this program have had their homes foreclosed by the banks.

The measure that ended up being in the bill gave the government the capacity to renegotiate the mortgages it, meaning the federal government, was holding on behalf of the American taxpayer.

The Republicans voted against the bailout bill for ideological reasons such as the one you mentioned that have no bearing on the crisis. In other words, it's kind of like McCain saying that he's going to reform Washington and make it better by getting rid of the $18 billion dollars spent annually on earmarks while still spending 10s of billions of dollars every month in Iraq.

[Superbus]

As soon as the government is out of the picture, the true value of these distressed assets will be known, then private capital can come in and purchase them at pennies on the dollar, saving the taxpayer.

[RnR]

DOW up 235 ... sky still above us ...

[Meggie]

No bailout required. Another bunch of BS from the Bush administration. I don't doubt that we need to readjust our credit useage, but we don't need to dump more of our grandchildrens' money into it.

[mike42nola]

I agree with you and I think that Bush and the House Democrats should stay out of the business of subsidizing lenders who didn't have enough sense to say " You don't have a job, how are you going to pay this loan back?" If their business practices were that poor we should not bail them out.

[necie]

I'm really trying my best to understand this mess....I've read everything I can in refernce to it....maybe one of you can enlighten me....

How will we, the taxpayers, be paying for this? Will they increase the taxes they take our of our weekly paychecks?

I have zero credit cards...I pay my bills, have never filed bankruptcy....I contribute to a 401K.....I'm sure I am far from being alone here, but I'm barely treading with my head above water with what I bring home now, there is NO WAY I CAN AFFORD FOR THEM TO TAKE MORE OUT OF MY PAY!

[mike42nola]

It is worse than you have imagined. This will be paid for by the Treasury as a loan to the financial institutions. The money paid by the Treasury is also a loan against our future earnings potential or our GDP. When a tax increase is passed and signed into law, which taxes are the only way to pay ourselves back, more money will be taken out of your check and held by the Treasury until you file your year end return. If you have made enough money and don't have enough deductions you do not get any refund.
Study the tax increases that Obama has proposed and you will find that he is misleading all of us about who will pay more taxes. Everyone who profits from selling stock, everyone who profits from selling real estate and everyone who receives any type of capital gain will pay more in taxes. Most of us cannot afford to pay more in taxes but there are other ways you get caught also. If taxes are raised on a corporation such as Exxon they just pass the increase along to the consumer which is us.
This bail out proposal, which failed mainly because it is filled with more pork, will have the tax consequenses passed on to our children because we are in debt beyond our ability to pay for it.

[TiffanyHusseinBanned]

This morning on CNN, Donald Trump stated that McCain was a brilliant man. That is the first time I have ever heard a McCain supporter describe him as being brilliant.

Donald Trump should never be allowed on any news show other than E News and Entertainment Tonight.

The guy is a i d i o t.

[grizhead63]

Donald's big hair has drained his brain of all nutrients.

[teron678]

He wants his Bush Tax Cuts!!!!!!

[mike42nola]

He must be one really lucky guy to have made the billions of dollars and all the time being an idiot. Wow!!!

[abby4ever]

I see the sell high, buy low principle is in play, stocks up roughly 240 right now.

[grizhead63]

Why did 40% of the Democrats vote against the Republicant bailout? Because they knew the Democrats were (as usual) being set up by the Republicans and Conservatives to take the fall and the hit on this whole deal.

Democrats should not consider any deal until ALL the Repubs, ESPECIALLY the Conservatives who brought America to its knees sign on and agree to vote for it too.

[abby4ever]

Pelosi talked as if they HAD agreed to it, then pulled back at the last minute in, as you suggest, a kind of setup. Like kids lined up to jump in a swimming hole and one says, "Go on, you go first, I'll be right behind you," but of course the one saying that has no intention of jumping. But if what you say is right, that they want us dems to take the hit, what is to stop them from doing the same thing next time? Will it go on ad in fin itum?

[mike42nola]

The Republicans are going to continue to kill this spend thrift bill even if it costs them the White House. You can at least count on them to be a lot more frugal and waste less of our money.

[Meggie]

Absolutely. In deference to the next president, if BOTH candidates do not vote for the final bill, then it should not pass. No excuses.

[theplaintrutho1]

You got that s**t right.

This was a George & Hank ram down ya throat, 2 1/2 page, no change or retaliation, take-it-or-leave-it proposal.

The Dem's understood the gravity for the American-public and were willing to be the fall guys knowing the majority of the people were against it.

From the Mac grandstand to His influence of the "hard-line" Re-thugs, looking to capture that public disagreement with the bill, it actually saved the Dem's from getting their ass-kicked later.

I personally believe it started with the super-bad-O-strategy of making that joint statement with Mac, than adding an political-posturing statement that almost forced Mac to make a comeback by parachuting into DC to have His posturing moment too.

Bad idea.

[mike42nola]

I don't think a bill should be passed and Congress should take the fall. If we keep crying Democrat/Republican we will never get out of these messes. Both parties have failed us and we have failed ourselves by allowing people who don't represent our best interests to stay in
Congress. Democrats and Republicans both are to blame along with the American people as a whole.

[Revanchist]

Every time a bell rings another angel gets its wings.

The flip side; every time a lawmaker whines, an angel gets set on fire!

[LeftRight]

Please explain what the Dow Jones Industrial Average has to do with the economy? The fact of the matter is that Wall Street is NOT an indication of the strength or weakness of the economy! Wall Street is SIMPLY a way for those with money to make more money, by claiming to be purchasing portions of a company! Investing in a stock (which is not an IPO) will do NOTHING for the company, except drive up the value of the executives, who are getting paid BILLIONS in back dated stock options!

[mike42nola]

You are way too cynical. I am not a company executive and have made plenty of money both in speculating on a companies value for the short term and long term retirement investing. Without investment companies are not able to grow. It is that simple and the value of the Dow Jones is directly tied to what proffesional traders believe the future of the countries economy is going to be like.
Speculators have gotten a bad name but everyone that has ever bought or sold a stock is a speculator and that amounts to at least 80% of the people in the country. The price that someone pays for shares of a companies stock is an investment in that company's future.

[LeftRight]

The Dow is a SPECULATIVE estimate of the strength of a corporation. It has very little to do with the actual strength of that company.

And for what it's worth, unless the COMPANY is the one selling you the stock, they will make NO money from the transaction. The person who CURRENTLY owns the stock will make (or lose) money, but NONE of it will be going to company!