Business & Media Institute
Tuesday, Nov 4, 2008
The writing is on the wall, even though the wall may not like it.
CNBC’s Erin Burnett told MSNBC’s “Morning Joe” that Wall Street was predicting that Sen. Barack Obama will win the presidency, but an upset from Sen. John McCain might boost it.
“This market has priced in Obama, has not priced in McCain,” Burnett said on the Nov. 3 broadcast. “Some people say that if McCain were to have an upset and win the market might get a big pop, who knows, but down here the conventional wisdom is, is that Obama has been priced into stocks.”
When asked to explain the term “priced in”, Burnett said, “It just means the market expects it. So, if Obama wins the market probably isn’t going to do anything one way or the other.”
But Burnett said the markets were even more concerned about a possible 60 seat majority for Democrats in the Senate.
“Now, the one thing that the market is going to watch, um, is, is this filibuster proof 60 that you talk about. That actually matters, whether you are going to get Democrats across the board and get a mandate on that front. The market is watching that, perhaps even more carefully than the presidential side of the election,” Burnett said.
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Other financial experts have warned that about the election’s possible economic repercussions. Dariusz Kowalczyk, an analyst for Honk Kong-based CFC Seymour, wrote in a research note quoted by the Associated Press that Democratic control of U.S. economic policy “would risk disincentivising entrepreneurship,” and could have a negative impact on productivity and growth.
“Clearly, the investor class – which many pollsters define as those who have more than $5,000 invested in the stock market – is critical to a McCain victory,” BusinessWeek magazine said Nov. 3.
The magazine spoke with Pat Consolmagno, an 87-year-old retiree in Englewood, Fla., who said, “Obama? I don’t think he’s got a clue.” Consolmagno said she was backing McCain even though the investments she and her husband Joe own “are not worth what they were.”
The Consolmagnos live off the “roughly $80,000 they get from earnings on their mutual funds and savings, Social Security, and a Chrysler pension.”
“I don’t think either [candidate] is a genius when it comes to the markets; we’re just sitting here waiting to see what happens,” said Pat Consolmagno.
This article was posted: Tuesday, November 4, 2008 at 5:46 am