Markets, Politics & Confidence
April 13th, 2009
Fundamentals:
“To appoint a very strong personality into a prominent cabinet position requires a great deal of courage.”
— Henry Kissinger, former Secretary of State, praising Hillary as Obama’s likely choice (ABC News, Nov. 16, 2008).
— Henry Kissinger, former Secretary of State, praising Hillary as Obama’s likely choice (ABC News, Nov. 16, 2008).
Political observers here have had nothing but good things to say about native daughter Hillary Clinton and the job she is doing running the State Department and avoiding news cameras. Some are even going so far as to give her indirect credit for helping to improve conditions in the credit markets. We’re hearing that the calm confidence she exudes is much admired by the other senior members of the President’s team, and even more so by the lesser experienced policy makers. By handing over control of the State Department to Hillary, so the talk goes, Obama did himself and his new administration a huge service by putting foreign policy in the hands of the most experienced people in the Democratic party, the Clintons, which frees the President up to concentrate on the domestic front, specifically the economy. With confident professionals like Hillary setting the tone by working hard and avoiding the news cameras, and mentors such as Bob Rubin and Alan Greenspan just a phone call away Obama’s economic team is more focused, and less weary of making mistakes as a new administration under a young President might otherwise be.
What you may ask does this have to do with the currency and stock markets? The answer is confidence, which much like fear is infectious. That Fed and Treasury watchers are seeing secretaries and undersecretaries coming and going with assured strides and ties up and collars buttoned goes far indeed in the circles we operate in.
Though it may not seem like it following the drubbing stock indices world-wide took in February of this year, the Dow Jones Industrial Average is back at the level it found itself at when the former Freshman Senator was sworn in as President back in January – approximately 8,000.
As Secretary Kissinger alluded to back in November of 2008, Obama did in fact show strength by hiring Hillary Clinton. Regardless of opinions on all sides, the current U.S. administration has done a good job of not making the situation worse, and by doing so can arguably be given some credit for the modest bear market rally currently budding in stock-indices, and blooming carry pairs.
Jay Norris
www.trading-u.com
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