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September 29, 2008


That was the date the House voted down TARP, a $700 billion nation-saving economic bailout (which was fully repaid with interest).   As the House voted, I watched the Dow lose a heart-stopping 777 points.

I thought about that yesterday as the House voted on the budget to kill ObamaCare.  The futures market indicated the Dow would lose a mere 30 points at the open, which it did.  (It normally has a down day after reaching a new market high.)  However, as the House voted, I watched the loss increase to 120 points.

In fairness, the Dow lost about 185 points by closing, but some small part of that loss must be attributed to Friday’s quarterly “triple witching” which makes the market unusually volatile.  (This will be explained in a future blog.)  But, it caused none of the 90 point loss suffered as the House voted.

The market was reminded yesterday that, if Congress must choose between losing the purity of their ideology or losing yet another credit rating, it cannot be trusted.

After surviving the Fiscal Cliff, after avoiding the annual European collapse this year, after anguishing all year over the GDP growth rate of China, and after reaching a new all-time record high despite all the headwinds this year, the stock market now faces another new drive-by shooting by people trying to help us . . . or at least help their own reelection.

Forever the optimist, assuming the German election doesn’t produce any ugly surprises next week, I do think the stock market will suffer the next few weeks before rallying into the end of the year.

Maybe, we should just stop televising House votes . . . ??

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