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November 20, 2008



Alright, I'm convinced. The market has decided that the economy is tanking because we elected Obama.

Nathan Smith

Hey, no sarcasm here! "Since Obama's victory" is the most concise way of explaining the chronology of the slide.



Obama's victory is certainly not the most notable part of the graph to me. Even when I change the timescale to be only the last month, it's still not all that singular:



Actually, didn't the slide coincide more with Palin coming to the national stage?

Nathan Smith

No, that doesn't fit the data. It was when the House GOP rejected the Paulson bailout that the slide got going. Passing the bailout later didn't stop it. But there was a marked recovery in the week or so leading up to the election. Then it dropped sharply after Nov. 4th, and has been zig-zagging downwards ever since.

A casual glance would suggest that the Paulson bailout scare knocked it down about 2,000, then it recovered 500, then something that happened Nov. 4th, 2008 (maybe the Obama victory, or maybe some number reported by some agency, who knows) set it sinking again. It may be finding its new level around 8,000. But it's still pretty volatile.


I believe Tom's was a tit-for-tat joke. From Sep 30 to oct 10 the market shed about 3500 points, recovered by almost 1000, then lost it again, then gained again, then lost again even deeper, then started to gain again, then Obama was elected, then it lost again, rebounded again, then lost it again (but not as deep at Oct 27) had a solid one-day rebound, then started dropping again as horrible earnings reports and forecasts pummeled the market. I mean, Intel had to issue their quarterly update almost three weeks early just because things had gotten so much worse than anyone had expected. Basically, there's just a bunch of companies that are all but shutting down their capital expenditures. The bottom has dropped out of the IT market because companies aren't willing or able to borrow any money and because consumers aren't buying anything. Because we elected Obama, of course.

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