I'm sure there is a mental factor and self-fulfilling prophesy aspect to it, but when 600,000 people get laid off last month and GDP contracts by 6%, there's something very real going on.
For about a week period or so in Sept/Oct, there were virtually no auto loans being out in parts of the country. But on a broader note, people stopped buying cars long before the election: August 2007: <I>Data show twice as many Americans are putting off purchasing vehicle</I> http://www.msnbc.msn.com/id/20393888/ April 2008: <I>Credit crunch hits used car market; CarMax profits drop 48%</I> http://www.bloggingstocks.com/2008/04/04/credit-crunch-hits-used-car-market-carmax-profits-drop-48/ April 2008: <I>European car sales plummet as the credit crunch takes its toll</I> http://business.timesonline.co.uk/tol/business/industry_sectors/engineering/article3753340.ece October 2008: <I>Auto sales plunge as credit crunch hits</I> Things started slowing in 2007. It accelerated when the credit crunch hit, which caused panic, which caused even more people to stop buying not knowing what the future is. The wealthy stopped buying when their wealth kept disappearing in the stock market, caused by the complete collapse of the banking system. None of this has to do with the election, and all of it was put into motion will before the election.
were MBS's created, bought and sold due to the election? were CDS's created, bought and sold due to the election? were various other financial derivatives created, bought and sold due to the election?
dude this shows you either have little understanding of our total economy or you're just arguing to argue. commodity prices have a hell of lot more to do with than consumer spending. so does big ticket manufacturing
And it has very good reason to be halted by fear. Most consumers (the average American) are in debt or have little to no savings. You can rationalize not saving when times are great and everything is on the up, but when half of your company is getting laid-off, it might be time to consider paying down the credit card bill and getting that rainy day fund ready.
Fear and Greed are the primary forces of market valuations. Either can be rational or irrational. I think the current fear is justified, the dominoes are falling worldwide and the US government is THE only entity that can start their restacking. But it wasn't the election, it was 20 years of greed, subversion of regulation (the buying of the government through campaign financing and the promise of future jobs ) and the largest most respected financial entities creating and selling outrageous risk that they couldn't even quantify. Not everything is about partisan politics, but everything is always about the money. If anything this election was the last best hope to restore sane oversight. Any administration associated with Phil Gramm would be throwing gasoline on this fire. Now, turn off the talk radio and start thinking.
I am not sure if this was directed at me or not but I don't just repeat what I hear. I am not putting blame on either party for the election coverage. I am just thinking that this perfect stom of f-ups was bolstered by all day everyday coverage of the election.
You could argue the opposite. Without the election to distract coverage with such brilliant stories as Jeremiah Wright, Bill Ayers, Palin's wardrobe etc, there would have been more coverage of the economic collapse and more fear...
The election had no effect on out economy the lack of regulation on wallstreet given by congress what had an effect on the economy. The fact is that giving the ability for wallstreet biders to take unnessary risk witht eh public money and without taking risk of their created the economic problem we're in now.
CaseyH, did the election play a role. ABSOLUTELY. But you cannot simplify this issue down to one variable. Other variables: 1. $140 oil - not relevant to election 2. Mortgage bubble -not relevant to election 3. Valuation of $ against world currencies #3 was impacted by the Iraq war and the amount of money the US borrowed to fund the Iraq war. That led to #1. Not related to election. #2 gave rise to a larger banking/insurance crisis that rippled across the globe. Since the banks/insurance companies are the very same engine that runs Wallstreet, this to a huge short selling bananza and the stock market crash. Again ...not related to election. #1 falls squarely in the lap of W. This started in 2000. His big oil policies and attack on Islam played a role. But furthermore, lack of regulation on speculation trading, given the climate of favorable big oil policies and middle east unrest, had speculators in a frenzy that oil prices would keep rising which was a self fulfilling prophesy ...until the bubble finally burst. ...and again, nothing to do with the election. The collapse of Bear Sterns was the catalyst that said to everybody we are in BIG trouble. At THAT point is when fear took hold ...and rightfully so. At that point, consumer spending took a crapper. The economy was CLEARLY in big trouble well before the election. I doubt there is any argument you could make that would provide proof that the election artificially escalated the recession. No major crisis can be condensed to simple cause/effect. Instead, a crisis is always a combination of factors. Given that recessions last for years and elections happen every 4 years ...a recession is bound to span an election. It's inevitable that it will be an election topic. So to blame election coverage for the recession is like blaming the ice bergs for being in the way of the titanic. The two forces were inevitably going to clash. If that's true, it serves no purpose to place blame on the election ...or blame the ice bergs. Better questions are, who constructed the boat? Who engineered the boat? Who was the captain? Who's job was it to put life boats/vests on the Titanic? Another reason the Titanic sank is because it was night and they didn't see it till last second. So is it the sun's fault for not being out?
the Iraq war has cost MUCH less than the stimulus package. I find it odd with this article http://news.yahoo.com/s/ap/20090315/ap_on_go_pr_wh/obama_economy Saying what I have been talking about. For getting elected you spread fear and doubt. Once in office it is a different tune. The fear and doubts were hardcore this cycle.
The economy was not the central issue of the campaign till September. Please point out how fear and doubt was spread about the economy before President Bush said our entire financial system was about to collaspe and asked for $700BB.
The stocks I've bought this year have all gone up. I have only President Obama to thank for that...as we all know, every stock market fall and rise is based solely on the words and actions of our Commander in Chief. Thank you, Barack!!!
