Honestly, looking at McCain and Obama objectively (without any party affiliation or any racism) I really can't see why anybody would vote for McCain. Obama has offered a much more coherent plan to get America out of the economic disaster we are in.
Right now, most people are anxious about the economy, fearing the worst but hoping for the best.
Reality check: within 18 months YOU could be standing in a bread line. That's how bad it really is. And Obama will work actively to prevent this short term, as well as make us strong again long term. As much as I like McCain and admire his patriotism, he really is not up for the job, not now with the global markets falling apart.
Obama's economic plan can be found at:
http://www.barackobama.com/issues/economy/index.php
The Anatomy of Fear
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It's not all in our heads, though. For in the last few months, there have been plenty of good reasons to worry about the health of Main Street and Wall Street. Jobs fell by 159,000 in September, the ninth straight month of losses. Auto sales fell by 26 percent. Retailers from J.C. Penney to Nordstrom reported disappointing September sales, and began dialing back expectations for the vital Christmas season. The sudden freezing of credit, on top of the poor fundamentals, has killed confidence. In the week from Sept. 18 to 25, 79 percent of consumers interviewed for the University of Michigan consumer-confidence survey expected a bad economic year, up from 57 percent earlier in the month.
During good times, economists note the presence of a "wealth effect." Higher home or stock values make people feel more financially secure. Now, as home prices continue to fall—down 9.5 percent in September 2008 from the year before—and 401(k)s wither, we're seeing what might be dubbed a "poverty effect." "The heightened financial turmoil that we have experienced of late may well lengthen the period of weak economic performance and further increase the risks to growth," Federal Reserve chairman Benjamin Bernanke somberly told the National Association for Business Economics in Washington on Oct. 7, a day when the Dow fell 508 points.
Time was, a few well-placed words from the Federal Reserve chairman could bring a market panic to a halt. In the 1990s, global markets had an ironclad faith in the ability of Fed chief Alan Greenspan, and his cohorts in the Clinton administration, to work their way through economic crises. Bernanke gets no such benefit of the doubt. He and his fellow economic firemen—Treasury Secretary Henry Paulson, Bush and congressional leaders—have taken bold, decisive action, as they continually remind us. It just hasn't been working for the past year. The bailouts, starting with Bear Stearns in March, and growing in size and frequency (nationalizing Fannie Mae and Freddie Mac; throwing a lifeline to AIG; guaranteeing money-market funds; the $700 billion bailout), seem to only have begat more panic. Why? Since the first measures didn't work, investors fear that the most recent one won't either. We keep taking injections to fend off the fever. But each time, a larger dosage lasts for a shorter time. Will the latest booster shot—the plan announced Friday, Oct. 10, for the government to take direct stakes in banks—prove to be an effective inoculation?
The protestations from on high are that, underneath the disaster, the fundamentals are still strong, that we'll work through this because we're Americans. "Fellow citizens," Bush fumfered Friday, "we can solve this crisis—and we will." Unfortunately, his reassurances seem about as calming as the scene from "Airplane" in which the flight attendant urges everyone to remain calm while all hell breaks loose. We have no Churchills today, and our financial leaders all seem to have fled to a bunker. On CNBC, Tyler Mathisen practically begged a name-brand CEO—anyone—to come on the air and speak to the American people.
For now, we have to seek solace in small positive signs: decent earnings from IBM, a week going by without a major financial institution failing. The most crucial indicator of an end to the rising fear may be, counterintuitively, more of it. Students of bubbles note that investor sentiment is always most bullish when a market is about to hit a top (when Business Week ran a cover story in 1979 heralding the "Death of Equities," it signaled the start of a long-running stock-market boom), and most bearish just when it's about to bottom. But when there's nobody left to lose confidence, when the ultimate stock guy throws in the towel and urges people not to buy stocks again until 2013, that sure smells like capitulation.
With Temma Ehrenfeld, Matthew Philips and Ashley Harris in New York, and Daniel Stone in Washington
© 2008
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