Why Does Wall Street Dislike Obama?

Published in South China Morning Post
(China) on 3 March 2009
by Yuan Xiaoming (link to originallink to original)
Translated from by Peter Stevens. Edited by Katy Burtner.
A few of my Chinese friends cast votes for Obama in the election, hoping he would bring change. They have not been disappointed, for he has brought a series of changes, the biggest of which involves Wall Street. Of course, stock market reforms were absolutely not the change my friends were hoping for - they expected the stock market to go up, but what makes people lose hope is that the market instead remains in free-fall.

The day after Obama won the election, the stock market fell, setting the record for a post-election drop in the market. Then, on the day Obama took office, the market fell again - the largest drop on inauguration day in history. Then, again, following Obama's first address before both houses of Congress (dubbed the best such speech in history by some in the media), the stock market remained in continuous decline. Since inauguration day, the Dow has already fallen nearly 2,000 points, or more than 20 percent. I can't say that the fall of the stock market is wholly due to Obama, but considering the market's 6-12 month forecast for the economy, it's obvious that Wall Street does not like Obama, marring his first month in office with a 2,000 point drop.

Why does Wall Street dislike Obama? Actually, it may be better to say that Obama has disdain for Wall Street and was heavy-handed toward it during his first month in office, causing the stock market to fall continuously.

During his election campaign, Obama often talked despairingly of the American economy, saying America had already entered its worst state since the Great Depression. This was an understandable strategy and nothing more than a desire for Bush to assume responsibility for the U.S. recession.

Among the factors affecting the stock market, the U.S. government's attitude toward the prospects of the economy is an extremely important one, receiving a lot of attention from both domestic and international investors. This is not to say that America's economic condition is not severe, but Obama's habit of saying "the economy may never recover" is really too pessimistic - even former President Clinton indicated that Obama should not simply be discounting the economy, but instead needs to point to signs of hope. In his address, Obama mentioned his hopes for the renewal of the U.S. economy, but in the past month, Obama and his cabinet members had, through speeches, already made their attack on Wall Street a fait accompli. One speech alone cannot change this reality; Wall Street and the market have already lost confidence in Obama.

Obama's economic policies, in particular his stimulus package, are also unfriendly toward Wall Street. His plan is mainly focused on government spending. To be sure, government spending can stimulate the economy, but government spending is inevitably less efficient than private investment. Furthermore, government projects are very slow and the stimulus package contains a number of capital projects that would need more than a year to impact the economy. In addition, a lot of capital has been wasted. In the city where I live, for example, $80 million has been allocated to expand the light rail system, though hardly anyone has used it for the past few years and the local government has already lost a lot of money. I'm afraid this $80 million will also be washed away. More importantly, tax cuts only comprise a small part of Obama's stimulus package, mostly through tax cuts for individuals: an individual will get $13 in tax cuts per week, not even enough to go to a restaurant. Regarding corporate taxes, capital gains taxes will hardly go down. In fact, lowering corporate and capital gains taxes could help companies ride out the storm, lower unemployment, and provide an immediate economic stimulus.

After securing the $800 billion spending plan, Obama then urgently put forward a $75 billion rescue plan for the housing market as an attempt to pass a government subsidy for homeowners to stay in their homes. However, many of these homeowners are absolutely unable to pay off their mortgages and Obama's rescue plan does nothing more than prolong their sort of harmful behavior. In the end, the homeowners will not pay off their housing debts and the subsidies will wind up in a bottomless pit with $75 billion being only the beginning. Facing this type of expenditure, Wall Street was, of course, not happy. After the $75 billion plan was announced, the market again fell. At a White House press conference, reporters asked Obama's press secretary about the hit on Wall Street, who said that the government cannot pay attention to the fluctuations of the stock market at this time - it's more important to give aid to troubled homeowners.

Of course, not all American voters are willing to support people on welfare and, in fact, the latest opinion poll shows that half of voters oppose Obama's spending plan. These kinds of poll numbers do not favor the course the Obama administration has taken. Perhaps Obama forgot that more than 60 percent of Americans own stock, directly or indirectly. If the market continues to fall and the economy keeps changing, the Democratic Party will certainly lose a lot of votes come election time in 2010. And if the economy is lifeless in 2012, it will be very difficult for Obama to stay out of the frying pan.


我的一些华人朋友在大选中投了奥巴马的票,他们希望奥巴马带来改变。奥巴马没有让他们失望,他带来了一系列的改变,最大的改变就是华尔街股市的改变。当然,股市的改变并非是我那些朋友们所期望的改变,朋友们期望股市“北上”,但令人失望的是,股市却是在不断“南下”。

  奥巴马当选的第二天,股市跌幅创了总统当选后股票下跌的历史纪录,接着,奥巴马就职那天,股市下跌又创了总统就职日的历史纪录,再接下来,奥巴马对国会参众两院做第一次国情咨文演讲,按美国媒体上的一些评论人所言,奥巴马做了历史上“最好”的国情咨文演讲,可是就在这个“最好”的演讲之后,股市连续走低。从奥巴马当选至今,道琼斯指数已经下跌了近2000点,下跌超过了20%。我不能说股市下跌都与奥巴马有关,但考虑到股市对经济有6个月至1年的预测,明显的是,华尔街不喜欢奥巴马,在奥巴马就职后的一个月内,华尔街给他来了个2000点下跌的见面礼。

  为什么华尔街不喜欢奥巴马?其实,话应该倒过来说,是奥巴马看不上华尔街,在他上任的一个月内对华尔街连出重拳,使股市不断走低。

  奥巴马在竞选中经常贬低美国经济,说美国经济已经进入到大萧条以后最坏的经济。这是完全可以理解的策略,无非是要布什承担美国经济衰退的责任。在当选以后,奥巴马又声称,如果国会不立即通过他的救市方案,美国的经济可能永远恢复不过来。

  在影响股市的主要因素中,美国政府对经济前景的态度是非常重要的因素,美国与海外的投资者都非常看重美国政府的态度。这里不是说美国的经济形势不严峻,但奥巴马什么“经济可能永远都恢复不了”的说法也的确是太悲观了,就连前总统克林顿都公开表示,奥巴马不应该一直贬低美国经济,而是需要指出希望所在。奥巴马在国情咨文演讲中提到了美国经济重新增长的希望,但在过去一个月来,奥巴马以及他的内阁成员在言语上对华尔街的打击已经是既成事实,一个演讲改变不了那样的现实,华尔街股市也已经对奥巴马失去了信心。

  奥巴马的经济政策,尤其是他的救市方案,也是对华尔街不友好的政策。在奥巴马的救市方案中,主要是政府开支。没错,政府开支能刺激经济,但政府的开支在效率上必然低于私人企业的投资。此外,政府的项目投入非常慢,救市方案中的许多项目资金要在一年多以后才能进入到经济之中,而且许多资金都会被浪费掉,比如,我所在的城市从救市方案中得到了8000万美元去扩建轻轨铁路,然而过去这些年并没有多少人去乘轻轨,当地政府已经赔了许多钱,这8000万恐怕也会打水漂。更重要的是,减税在奥巴马的救市方案中仅占有小部分,完全是对个人的减税,并且少得可怜,一个星期给个人退税13美元,还不够下一顿饭馆。对公司所得税、资本利得税根本没有减少。事实上,从实践上来看,公司所得税、资本利得税的减少可以帮助公司渡过难关、减少失业,可以立即刺激经济。

  在搞定8000亿美元的开支方案后,奥巴马又急急忙忙地推出了750亿美元的楼市拯救方案,试图通过政府的补贴帮助大约900万房主留住他们的房子,但这些房主中的很多人其实根本无力支付房贷,奥巴马的楼市拯救方案无非是延长那样的不良行为,因为那些房主最后也支付不了房子的贷款,政府那样的补贴就是在填一个无底洞,750亿美元只是一个头款,后面一定需要更多的开支。对于这样的赤字开支,华尔街股市当然不高兴。在750亿的方案出台后,华尔街的股市又是下跌,在白宫的记者招待会上,就华尔街股市的重创,有记者问到奥巴马的新闻部长,他说,现在这个时候,政府不会太在意股市的涨落,更重要的是去救助那些处于困境中的房主。

  当然,美国的选民也并非都是愿意吃福利的人,事实上,最近的民意调查显示,半数的选民反对奥巴马的开支方案,并且,这样的民意正在向着不利于奥巴马政府的方向发展。也许奥巴马忘了,60%以上的美国人直接或间接的拥有股票,如果股市继续下跌,经济不断恶化,在2010年中期选举的时候,民主党一定会失去不少席位,而如果在2012年经济没有气色,奥巴马也难逃被炒鱿鱼的命运。
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