Wall Street likes gridlock

[UtahDan]

Originally Posted by jay santos

Haven't the repub's had enough time to streamline gov and expenditures? I'd love it as well, but this notion that the repub party is the one to do it is quickly becoming a theoretical fantasy. The only time in my lifetime that this happened was when we had a Dem president. And yeah you can give credit to the repub Congress at the time, but that Dem pres made campaign promises and then delivered on them.

The Republican party as currently constituted is not the one to do it, I agree. They have had a chance and failed. Because conservatives have liked Bush so much for other reasons, they have tolerated him on this point and the Republican party has become a safe haven for big spenders like the president himself. Conservatives understand that the elephant in the budgetary room is entitlements and anyone serious about reducing government spending will need to make some tough choices about them. So our fearless leader helps enact a collosal new entitlement.

Just as the Democrat party successfully retook power last night in large measure by nominating candidates who are not the traditional liberals who lost elections for the last 12 years, look for the Republicans to come back in the next cycle with more Gingrich type Republicans who insist on a balanced budget and fiscal responsibility.

Now that the Dems are back in the majority, it will be interesting to see the new moderates interact with Nancy Pelosi and others in the left wing of that party.

[Archaea]

Well show it.

You may be good at micro-industry specific, but his macro skills aren't that wonderful.

If his sole analysis is, "Well Clinton was there when something happened," that's wonderfully precise.

I'd expect to see matters such as M1 and M2 discussed. We should discuss some curves. He should counter with real actual cuts in government, outside of the military. He'd be hard-pressed to do so. Clinton was lucky and lucky that he didn't have Dems control or he never would have "balanced" the ongoing budget. Now I imagine he can whip my butt on the actual calculation as I haven't had to do that in two decades, but it was something easy for me.

The national debt still exists and grew under Clinton, it was the operating budget that "balanced".

[jay santos]

Originally Posted by Archaea

Well show it.

You may be good at micro-industry specific, but his macro skills aren't that wonderful.

If his sole analysis is, "Well Clinton was there when something happened," that's wonderfully precise.

I'd expect to see matters such as M1 and M2 discussed. We should discuss some curves. He should counter with real actual cuts in government, outside of the military. He'd be hard-pressed to do so. Clinton was lucky and lucky that he didn't have Dems control or he never would have "balanced" the ongoing budget. Now I imagine he can whip my butt on the actual calculation as I haven't had to do that in two decades, but it was something easy for me.

The national debt still exists and grew under Clinton, it was the operating budget that "balanced".

You're right I am more into micro than macro. Micro has some science to it. Macro is all theory with only basic fundamentals agreed on.

You can get an economist to tell you anything you want, just like a statistician.

What you're arguing is not numbers but intent and "what ifs". I'm not going to get into that debate because 1) i'm not educated on it and 2) I suspect there are too many opinions to agree on any of it.

When you tell me the repub's really are the fiscally responsible party and it's just bad luck and circumstances that the only time in my lifetime that our country acted fiscally responsible was when we had a Dem prez, then it feels a lot like all the homers defending Crowton to his death.

[Archaea]

Originally Posted by jay santos

You're right I am more into micro than macro. Micro has some science to it. Macro is all theory with only basic fundamentals agreed on.

You can get an economist to tell you anything you want, just like a statistician.

What you're arguing is not numbers but intent and "what ifs". I'm not going to get into that debate because 1) i'm not educated on it and 2) I suspect there are too many opinions to agree on any of it.

When you tell me the repub's really are the fiscally responsible party and it's just bad luck and circumstances that the only time in my lifetime that our country acted fiscally responsible was when we had a Dem prez, then it feels a lot like all the homers defending Crowton to his death.

No, Reps are not a fiscally responsible party, they have more fiscal principles to which their adherants subscribe to. But, due to media pressures of wanting to be liked, they cave in and give in, but they don't campaign on the basis of buying votes.

The Dems buy votes directly through government programs.

Micro, because it uses more or less closed systems, is more explainable based on statistics and math. I'd disagree calling it a science in the traditional sense, even if it involves complex statistics and math.

Macro is more difficult because it involves an essentially open system where variable control is not possible, even though money supply does correlate frequently with certain eventualities.

[hyrum]

Originally Posted by jay santos

That about sums up my feelings about the election.

The two party system is designed to force everybody to the middle. It does a pretty good job of it. Republicans were in power so long, the Dem's have been forced to the middle to win back power. They successfully did that. Now the Repub's will have to do the same. It works. Repub's and Dem's fight like cats and dogs and call each other the devil. In reality, if you graded all politics on a liberal/conservative continuum 1 to 100 with 50 being the American average, Dem's would be a 48 and Repub's would be a 52.

And until one party goes too far out of whack to allow the other party to take complete power, we'll have gridlock, and nothing will get done. That's a good thing.

Gridlock is NOT at all good for the markets or anyone if the tax cuts are not renewed. Its a very unusual situation to have significant tax cuts that scale-up and then abruptly die. If you're going to do anything with tax consequences better get it done before 2010.

That said, I agree the diff between Dems and Repubs is not as great as all the talking heads on cable TV & talk radio would have us believe.

[jay santos]

Originally Posted by hyrum

Gridlock is NOT at all good for the markets or anyone if the tax cuts are not renewed. Its a very unusual situation to have significant tax cuts that scale-up and then abruptly die. If you're going to do anything with tax consequences better get it done before 2010.

That said, I agree the diff between Dems and Repubs is not as great as all the talking heads on cable TV & talk radio would have us believe.

To be honest I was surprised to hear that the Dem's victory was met enthusiastically by Wall Street. They're pretty good at incorporating all expected future events, which would include possible recall of the tax cuts. I was taught by my parents and my BYU prof's the Arch political model but it hasn't held up to reality and little by little I let it go.

[Archaea]

The markets try to hedge against all potentialities, and that's why large industry sectors can hedge against any fiscal reactions. However, a slowdown in capital influx, if money supply is affected as well as marginal tax rates, do ultimately impact the markets.

I don't see a reason for reading much into markets on the short term, as very few of us can take advantage of short term changes. We're impacted by long term and that's where policies such as tax rates matter.

In the short term, most publicly traded corps can plan from quarter to quarter. However, they do poorly in planning long term, at most of the financials that I end up reading. Wall Street rewards quarter by quarter, not long term strategies.

Dems encourage more regulatory control.

Reps have won some deregulatory battles in the past. Dems haven't ever to my memory sponsored deregulation.

[il Padrino Ute]

Originally Posted by hoyacoug

Check this out.

http://zfacts.com/p/318.html

The biggest raises to the national debt have been from Republican presidents (and most recently from a Republican president with Republican Congress).

Or this:

http://zfacts.com/p/480.html

No Democratic president has contributed to the gross federal debt during his presidency (measuring the gross federal debt upon entrance to office against the gross federal debt upon leaving office) by even a dollar. The entire amount has come during Republican administrations.

Funny how Dems like to mention this, but won't comment on the fact that inflation and was never as high in this country as it was when a Democrat was in the White House and the Dems controlled both houses. Any reason?

I was always under the impression that it was the Congress and the Senate that decided how to waste the money, not the President, but if I'm wrong, it wouldn't surprise me.