The Score Is Now 0-2

Wall Street plunged for a second day as Obama fears widened.

After gaining over 300 points on election day, once Obama was declared the winner, the Dow suffered its worst one day point decline in post election day trading history. It fell over 486 points yesterday and was down another 443 points today!. That's only 929 points in two days!!!
The recent calls on the possible 'Obama' affect on the markets over the past few weeks has now, in the wake of the election results, been clearly vindicated.

While the uncertainty surrounding the U.S. Presidential election outcome has been removed - which is why we saw the rally on Wall Street Tuesday - it obviously has been replaced with the uncertainty of what a Democratically controlled House, Senate and Presidency will mean for U.S. business.

Remember, Obama and the Democrats ran on an anti - business theme. They intentionally used a populist message to get elected and now those who put them in power will expect them to live up to their campaign rhetoric of 'sticking it to business' and 'leveling the playing field for the common man'. Problem with that rhetoric is that ignores economic science completely.

Truth is folks, the Reagan Revolution is probably now over. The concept that free markets provide the best opportunities for creating wealth in a society, thereby consistently and overwhelmingly raising the standard of living for that society, is done. Forget the facts and the obvious numbers that prove them (as we stated in earlier reports, from a $1 trillion a year economy to a $14 Trillion a year economy). America is now embarking on a road that will take us back to the future. We'll revisit the old stale economic policies of the early to mid twentieth century (oh sure, they'll be dressed up to look sexier, but make no mistake they'll still be the old tired, failed policies of a bygone era). Keynsian economics will be rule of the day and Milton Friedman will be forgotten.

This election was purely the result of one of the biggest fears our Founding Fathers had in crafting this great and wonderful social experiment called the United States of America. While that fear was not directly addressed in the words of the Declaration of Independence or in the original version of the U.S. Constitution, it was consistently spelled out in the writings of men like Thomas Jefferson, Benjamin Franklin and John Adams. They feared this. How do we create that Perfect Union - one that would give everyone a voice to elect their leaders - yet ensure those who are able to make that decision are informed? How do we know that those allowed to vote truly understand the issues of their day?

What we witnessed on Tuesday, November 4, 2008 was the culmination of those fears. It has been obvious for several presidential elections now (going back to at least 1992) that feeding off the fears of the masses, keeping them uneducated about the way not only their system of government works, but more importantly how their economy works, and using their emotions and their prejudices rather than their minds to make an informed decision about who their next leader(s) should be is the clearest and easiest path to power. Hollywood has used this theme for years to entertain us and keep us coming back for more. That's fine if you want to escape for a few hours into fantasy land, but it's sad if that's the motivation used to select the leaders of the free world.