Written by Steven M. Cohen
The New York Post and The Wall Street Journal have a common ownership and share a nearly identical conservative philosophy, but the similarities stop there. The Journal has, over time, expanded beyond its financial news coverage franchise into more general interest reporting, while the Post has consistently adhered to a rather, shall we say, energetic style of conveying every conceivable kind of story. But last weekend both papers simultaneously came to the same conclusion observed in these columns weeks ago: the stock market moves inversely to Barack Obama's approval ratings.
Post columnist Terry Keenan placed this phenomenon in a broader context, noting that "[h]istory shows that when the approval rating for a US president dips below the magical 50 percent mark, it is also typically the time to buy." Her conclusion: "Let the Obama rally begin!"
The Journal editorial writers cited the president's current healthcare difficulties to explain the approval rating/market direction relationship. "Political uncertainty also continues to hang over risk-takers," the Journal observed "and on that point it has been fascinating to see the latest Wall Street rally coincide with the political troubles of ObamaCare. If it collapses, we might see Dow 10,000."
Even daily stock trading vividly reflects this same pattern. The sharp, cliff-like lines on an intraday chart often coincide with the ubiquitous Obama pronouncements and press conferences. Most interesting is actually watching one of these events in real-time, with one eye on the television and the other on the tape. The averages sink with practically each utterance, their descent arrested only when the president mercifully finishes up.
As the newspapers observed, the opposite occurs as the result of each new poll is revealed. Whether it's Gallup, Pew Research, Quinnipiac, WSJ/NBC, New York Times/CBS or any other major pollster, whether the subject is stimulus packages, healthcare, industry nationalization, or Obama's performance in general, as the president's numbers slip, the markets forge ahead, even in the absence of economic data that would suggest even the early stages of a robust, durable recovery. With Obama's overall approval rating hovering around 50%, the stock market could be on the cusp of its next leg up.
Team Obama reportedly paid plenty of attention to poll results and focus groups in tailoring its message during the campaign (pledges such as 'you can keep your own health coverage if you like it' and 'your taxes won't go up one dime if you earn less than $250,000.' Remember those?). Now, the administration and its congressional minions appear to be in a deep state of denial about the most recent polls or, alternatively, respond by challenging the legitimacy of their results.
How else to explain congressional Democrats digging in and grinding ahead with their thousand-plus pages of healthcare "reform" in the face of a non-partisan Congressional Budget Office report that demolishes every assumption on which the plan is based? How else to explain the administration's continuing effort to limit debate and ram through a bill despite numerous polls indicating that the vast majority of Americans are satisfied with their present coverage and believe that taxes will increase and services decline as a result of the government's meddling?
These are the politics of hubris, out of which flow plans and policies fashioned by arrogant "leaders" who know better than clueless poll respondents. With respect to healthcare, Obama and his Democratic cohorts know what's good for you, so you'd better open your mouth, hold your nose, and swallow this castor oil of an agenda. Like Leona Helmsley's take on taxes, poll results, independent opinion, and honest objections to the direction in which the country is sinking-those are for the little people.
Last November voters ushered in the "change" they were promised during the campaign. Having now seen the specifics of an agenda rolled out over the last six months, Americans are perhaps beginning to understand some of the changes that weren't so obvious as they joyously cast their votes for a candidate largely celebrated by the media as the man who would rescue us from the state of ruin we had arrived at under the evil Bush.
These changes include spending plans and projected deficits in numbers that are impossible to even imagine; the creation of a European-style nanny-state with myriad new entitlements paid for by the "rich," thereby fulfilling Obama's famous "spread the wealth" campaign promise; a Democratic juggernaut to bulldoze through plans to radically alter the relationship between patient and doctor; an industrial nationalization policy that turns taxpayers into involuntary owners of broken car companies and insolvent banks; rewarding the very same unions responsible in part for wrecking some of these nationalized basket cases with big ownership stakes while trampling on creditor property rights; the conversion of our economic system into a statist economy having far more in common with socialism than with capitalism; and perhaps the biggest change of all, a president who travels the globe offering apologies for his country's disrespectful and insensitive behavior, while embracing tyrants and bowing to white-robed kings.
This is but a partial list; Americans wanted change and they are certainly getting it.
The recent polls, then, are suggesting clearly that Americans are rapidly souring on some of these changes, just as the stock market delivers a no-confidence vote on the administration's plans for a Brave New World. And there is another important poll looming ahead: the 2010 elections. Perhaps the respondents to that poll will deliver a message that the administration and its condescending Congressional enablers will find impossible to ignore.
Steven M. Cohen has spent more than 25 years in the hedge fund business. His articles appear on Frontpagemagazine.com. as well as on his own blog site, buyselljump.com.