Tuesday, March 23, 2010

Does Dow Jones Rise Signal Economic Destruction?

The warnings were put out there by the conservatives against the impending health care legislation being signed into law. In the year leading up to Tuesday's momentous occasion, the right-wing had claimed the bill is bad for business, focusing on the hefty price tag attached while ignoring the benefits or the figures that point to a reduction in the deficit, but if the bill was really bad for business, then why has the Dow Jones Industrial Average risen the past couple days since the passage of the vote on Sunday in the House of Representatives? Considering the index was a marker for economic growth, especially following the recession during the Bush years, then what would the critics to Obama's health care have to say now? Why aren't investors running for the hills?

Maybe it is because ever since Obama had taken office, conservatives stopped believing in the Dow Jones, or any of the other indices, and started believing in their own brand of fuzzy math, which really consists of no mathematics at all, but just speculation of numbers. Polls mean something, but then they don't. The Congressional Budget Office is a sure sign of a bill's economic negative impact, but then they are nothing but partisan figures. The Dow Jones popped over a certain benchmark, but now it means completely nothing.

Now that the bill has been passed, and the stock market didn't plummet, what next? Last week, Larry Kudlow hosted Jim Cramer, in which Cramer stated that the bill was "the single biggest impediment to the stock market going higher," yet on the day following the passage of the bill, the Dow finished 43.91 points, and another 102.94 today, bringing a two day climb of 146.85. It doesn't seem that health care was that big of an "impediment" after all...

These warnings sound all too familiar. I believe that is because we heard them when Obama was elected, and there were warnings that a Democratic presidency would be bad for the market, but the Dow rebounded. In fact, every Republican prediction seems to have failed. Remember that overwhelming win coming for John McCain that the polls never showed because of some liberal bias? It never came, so I have come to the conclusion that when a prediction is made on the right, I should expect the opposite.

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