Comments for Does Congress Only Respond to Fluctuations in the Stock Market? at http://www.cepr.net , comment 1 to 6 out of 6 comments http://www.cepr.net Sun, 19 May 2013 08:15:24 +0100 FeedCreator 1.7.3 http://www.cepr.net/index.php/blogs/beat-the-press/does-congress-only-respond-to-fluctuations-in-the-stock-market#comment-20922 Congress is populated with people whose principle concerns are even more narrow than those of the money-grubbing creatures in American corporate boardrooms. Members of Congress are overwhelmingly narrow-minded, self-serving, poorly educated (lawyers, for the most part), and not particularly intelligent by any measure. Even the 'stars' like Chuck Schumer show themselves to be money-driven bigots at best. The tiny few who aim to do any good (Dennis Kucinich, Alan Grayson, Patrick Leahy sometimes, Barney Frank even less frequently) typically don't last long. There is little incentive for American politicians to inform themselves when it is easier to win reelection by misinforming the public (with the aid of a compliant, docile, corrupt news media). Couple that with the 20-plus years during which American news media have treated daily stock market outcomes as the primary indicator of economic performance, and you have the "truly scary" scenario Dean Baker describes. Stock market performance is taken to be an indicator of corporate performance and the Times, Wall Street, Congress, and Obama all take the preferences of the 0.1% to be the only preferences that matter. They actually view with scorn the preferences of the 95%, except for the string of months when they have to deceive voters into thinking that they are worthy of reelection (hence, Obama's sudden concern with fairer taxation when he didn't give a damn about fairness for the first three years of his term and still doesn't for the most part). - Hugh Sansom Sat, 29 Dec 2012 00:27:20 +0100 http://www.cepr.net/index.php/blogs/beat-the-press/does-congress-only-respond-to-fluctuations-in-the-stock-market#comment-20920 I've found it truly disturbing for awhile that this seems to be exactly the case. It's like everyone hangs on the word of stock market gamblers. I can't believe this hasn't been obvious to everybody for years now. It's like we're living in the Star Trek episode, "The Gamesters of Triskelion"... Shareholder value has become a more honoured right than any other right of citizens. - watermelonpunch Fri, 28 Dec 2012 15:19:32 +0100 http://www.cepr.net/index.php/blogs/beat-the-press/does-congress-only-respond-to-fluctuations-in-the-stock-market#comment-20917 NYT not so far off on this one. Both the market and Congress are stupid. The market has been betting a deal would be cut before the end of the year, but since the non-vote in the House last Thursday it is clear one will not happen prior to 1/1/13. The spectre of irresponsible stupidity that may really become serious when they have to deal with the debt ceiling a month or so later is suddenly back. As for Congress, constituents start screaming bloody murder when the market falls apparently because of some stupid action or non-action by Congress, and the louder the constituents scream, particularly the wealthy donor ones who have lots of their wealth in the market, the more even idiot tea party Republicans start paying atttention. - Barkley Rosser Fri, 28 Dec 2012 09:11:57 +0100 http://www.cepr.net/index.php/blogs/beat-the-press/does-congress-only-respond-to-fluctuations-in-the-stock-market#comment-20912 You seriously underestimate the effects Washington stupidity has on markets. During the debt ceiling debate marketsndropped 18 percent in a matter of weeks. At this point we are down around 2.5 percent. The rule of law has a much larger impact on valuations than you are alluding to and could be a reason valuations have languished 20% below historical averages even as profit margins and corporate profits have expanded to all time highs. There are two reasons markets move: an increase in earnings, or higher p/e multiple. I agree earnings won't be affected as government accounts for less than 10% of s+p earnings but let's agree to disagree on multiples contracting. - Jc Fri, 28 Dec 2012 05:22:18 +0100 http://www.cepr.net/index.php/blogs/beat-the-press/does-congress-only-respond-to-fluctuations-in-the-stock-market#comment-20908 Wall Street and business interests in general may be a much bigger factor in quelling R's stated desire to use the debt ceiling as a blunt instrument to force spending cuts from D's. - Robert Salzberg Fri, 28 Dec 2012 02:54:43 +0100 http://www.cepr.net/index.php/blogs/beat-the-press/does-congress-only-respond-to-fluctuations-in-the-stock-market#comment-20907 If the market doesn't think there will be a deal, it will go down, increasing the chances of a deal, which means the market goes up. Therefore, if the market goes down, it will go up, so why bother going down in the first place? Traders might want others to sell, so they can buy cheap, but no one wants to sell low. Seems an interesting conundrum for efficient market fans. - foosion Fri, 28 Dec 2012 02:43:56 +0100