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(CNBC)   Politics is killing the stock market. Why can't it be a murder-suicide?   (cnbc.com) divider line 41
    More: Spiffy, market participant, stock markets, Squawk Box, BlackRock CEO Larry Fink  
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1384 clicks; posted to Business » on 07 Jun 2012 at 3:30 PM (2 years ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2012-06-07 03:50:02 PM
Whenever Obama talks the
Market tanks
 
2012-06-07 03:52:57 PM
You can't take a long-term view of markets or investing when the government is changing policy -- or at least threatening to -- on a day-to-day basis. People biatch about businesses not hiring and sitting on their cash, but business decisions have 5-to-7-year time horizons and the vision of the lunatics running the DC asylum doesn't extend beyond the next speech or election.
 
2012-06-07 04:02:21 PM

jjorsett: People biatch about businesses not hiring and sitting on their cash, but business decisions have 5-to-7-year time quaterly horizons


FTFY
 
2012-06-07 04:04:02 PM
"We're compacting all this time frame and we're not seeing what I could call leadership and guidance and stewardship in terms of focusing on how to build a better future," he said. "If you go back 20, 30, 50 years ago you had many more circumstances where people focused on more long-term issues and we're not seeing that today."

Now excuse me while I go shut down an Ohio factory and put 2,000 people out of a job so our earnings report will show 14% growth instead of 13%.
 
2012-06-07 04:08:06 PM

Sergeant Grumbles: jjorsett: People biatch about businesses not hiring and sitting on their cash, but business decisions have 5-to-7-year time quaterly horizons

FTFY


Shareholders might have those kinds of timelines, but the people running the business can't. You don't build a new plant or open a new store and expect it to show up as profit on the bottom line in 3 months. And nobody is going to do those things when they don't know what their tax rates are going to be next year, or what new 10-volume set of regulations they're going to be expected to comply with next month.
 
2012-06-07 04:28:28 PM

jjorsett: Sergeant Grumbles: jjorsett: People biatch about businesses not hiring and sitting on their cash, but business decisions have 5-to-7-year time quaterly horizons

FTFY

Shareholders might have those kinds of timelines, but the people running the business can't. You don't build a new plant or open a new store and expect it to show up as profit on the bottom line in 3 months. And nobody is going to do those things when they don't know what their tax rates are going to be next year, or what new 10-volume set of regulations they're going to be expected to comply with next month.


It's not tax or regulatory uncertainty that's preventing businesses from plowing investment into the economy, it's a lack of consumer demand. Since businesses won't spend and consumers can't spend, the government must act to stimulate consumer spending.
 
2012-06-07 04:28:49 PM

jjorsett: Sergeant Grumbles: jjorsett: People biatch about businesses not hiring and sitting on their cash, but business decisions have 5-to-7-year time quaterly horizons

FTFY

Shareholders might have those kinds of timelines, but the people running the business can't. You don't build a new plant or open a new store and expect it to show up as profit on the bottom line in 3 months. And nobody is going to do those things when they don't know what their tax rates are going to be next year, or what new 10-volume set of regulations they're going to be expected to comply with next month.


Mr. vanWinkle, I have some news for you: This isn't the America or the business climate you knew when you fell asleep in 1971.
Not only have the Republicans you knew changed the party name to the Democratic Party, the John Birchers have taken over the House of Representatives and call themselves "Republicans."

It sounds crazy and scary, but the market uncertainty is closely tied to the fact that the Birchers are willing to hold the country's economy hostage to prevent the re-election of a man because he was born with a suntan. They've already done so more than once. The last time, they even caused our country's credit rating to be downgraded.

If you haven't been asleep since 1971, here's some advice: Repeating empirically false talking points won't ever make them true.
 
2012-06-07 04:41:29 PM
Politics seems to be killing everything right now.

Both sides are so busy making sure their "Team" wins that nobody seems to notice that it's killing the country.

BSABSKHITBASH
 
2012-06-07 04:43:58 PM
Great headline subby
 
2012-06-07 04:44:48 PM

Stile4aly: It's not tax or regulatory uncertainty that's preventing businesses from plowing investment into the economy, it's a lack of consumer demand. Since businesses won't spend and consumers can't spend, the government must act to stimulate consumer spending.


Has any government anywhere ever actually managed to pull this off? Attempts virtually always end in the government becoming just another customer, albeit one that is too big to fail.
 
2012-06-07 04:46:48 PM

jjorsett: Sergeant Grumbles: jjorsett: People biatch about businesses not hiring and sitting on their cash, but business decisions have 5-to-7-year time quaterly horizons

FTFY

Shareholders might have those kinds of timelines, but the people running the business can't. You don't build a new plant or open a new store and expect it to show up as profit on the bottom line in 3 months. And nobody is going to do those things when they don't know what their tax rates are going to be next year, or what new 10-volume set of regulations they're going to be expected to comply with next month.


You know, you should really get a big dose of reality. The people running companies big enough to have stockholders do not care about 7 years from now, because they have no plans to still be there. And in every business case, a small percentage of difference in the tax ON THEIR PROFITS is irrelevant.

But naw, I guess you think the government should guarantee that taxes and everything else will never ever ever change, no matter what is happening to the country?
 
2012-06-07 04:51:46 PM
In the end, these people in DC will never do anything to hurt Wall Street. But many of them are so lame that Wall Street will have to sit them down and spell out exactly what is expected of them.
 
2012-06-07 05:00:02 PM

Millennium: Stile4aly: It's not tax or regulatory uncertainty that's preventing businesses from plowing investment into the economy, it's a lack of consumer demand. Since businesses won't spend and consumers can't spend, the government must act to stimulate consumer spending.

Has any government anywhere ever actually managed to pull this off? Attempts virtually always end in the government becoming just another customer, albeit one that is too big to fail.


So your comeback for a clever restatement of how to apply Keynsian economics is a well-turned non sequitur neologism.
Not bad.
(It's execrable logic and patently false, but, as propagandistic sound bites go, not bad.)

Rebuttal: The contention that a New Deal-style jobs program (say, along the lines of the WPA or CCC) Just Works(SM) is strongly supported by empirical historical data. (See also: Marshall Plan.)
 
2012-06-07 05:07:37 PM

Millennium: Stile4aly: It's not tax or regulatory uncertainty that's preventing businesses from plowing investment into the economy, it's a lack of consumer demand. Since businesses won't spend and consumers can't spend, the government must act to stimulate consumer spending.

Has any government anywhere ever actually managed to pull this off? Attempts virtually always end in the government becoming just another customer, albeit one that is too big to fail.


Oh hai!

upload.wikimedia.org
 
2012-06-07 05:10:08 PM
Subby, you do know a lot of money is made when the stock market goes down, right?

Institutional investors and day traders like volatility, not stability. They stand to make a lot more money on placing the right bets when markets are swinging. Long term investment is for chumps in today's markets, same as in today's boardrooms.
 
2012-06-07 05:26:33 PM

demaL-demaL-yeH: Millennium: Stile4aly: It's not tax or regulatory uncertainty that's preventing businesses from plowing investment into the economy, it's a lack of consumer demand. Since businesses won't spend and consumers can't spend, the government must act to stimulate consumer spending.

Has any government anywhere ever actually managed to pull this off? Attempts virtually always end in the government becoming just another customer, albeit one that is too big to fail.

So your comeback for a clever restatement of how to apply Keynsian economics is a well-turned non sequitur neologism.
Not bad.
(It's execrable logic and patently false, but, as propagandistic sound bites go, not bad.)

Rebuttal: The contention that a New Deal-style jobs program (say, along the lines of the WPA or CCC) Just Works(SM) is strongly supported by empirical historical data. (See also: Marshall Plan.)


See also Lend-Lease and WWII, and Reagan's military spending (which if nothing else, hired a lot of defense contractors and soldiers).
 
2012-06-07 05:43:28 PM
Actually, Wall Street is killing wall street. When you have a segment of the market that is essentially the penny rounding scheme from Superman III, and *that* is one of the more lucrative, you are farked. It's devolved into a casino, where there is the house and the little guy.

Well sure, casinos do rake it in from the idiots. But idiots don't tend to have a lot of money. Or at least for very long.
 
2012-06-07 06:13:24 PM
Money moving and being spent stimulates the economy and creates value. It's of little consequence if it's the government or citizens - so long as money moves, instead of sitting, it's probably going to help.

(Note that it does have to be broad-based, too, but I figure that's a given).
 
2012-06-07 06:40:36 PM

ghare: jjorsett: Sergeant Grumbles: jjorsett: People biatch about businesses not hiring and sitting on their cash, but business decisions have 5-to-7-year time quaterly horizons

FTFY

Shareholders might have those kinds of timelines, but the people running the business can't. You don't build a new plant or open a new store and expect it to show up as profit on the bottom line in 3 months. And nobody is going to do those things when they don't know what their tax rates are going to be next year, or what new 10-volume set of regulations they're going to be expected to comply with next month.

You know, you should really get a big dose of reality. The people running companies big enough to have stockholders do not care about 7 years from now, because they have no plans to still be there. And in every business case, a small percentage of difference in the tax ON THEIR PROFITS is irrelevant.

But naw, I guess you think the government should guarantee that taxes and everything else will never ever ever change, no matter what is happening to the country?


Taxes and regulations dont affect business decisions. This is what farklibs actually believe.
 
2012-06-07 06:41:51 PM

LasersHurt: Money moving and being spent stimulates the economy and creates value. It's of little consequence if it's the government or citizens - so long as money moves, instead of sitting, it's probably going to help.

(Note that it does have to be broad-based, too, but I figure that's a given).


Where does the money sit? Do you think it's put in a vault?
 
2012-06-07 06:45:47 PM
Well I sure wish Mitch McConnell and Eric Cantor would stop doing that.
 
2012-06-07 06:54:06 PM

ghare: But naw, I guess you think the government should guarantee that taxes and everything else will never ever ever change, no matter what is happening to the country?


You've got the tax and regulatory regime you seem to want right now. Nobody knows what the hell tomorrow is going to bring and they're acting predictably, namely sitting it out. If your goal was economic stasis, high unemployment, and stagnation, you certainly got your wish. How that's a good thing I'll leave to you to explain.

Personally, I'd move away from a system in which business people are continually mystified about what might hit them next and are assured enough stability that they can make rational plans, but maybe that's too much to ask of you types who worship The State and all it stands for.
 
2012-06-07 06:58:59 PM
Opening line of the article: "Investors have to pay more attention than they ever have to political wrangling, and that's made the market more difficult to navigate, BlackRock CEO Larry Fink told CNBC."

OMG! The one-percent is having a harder time investing because politicians dare talk about them!

My tears will not stop.
 
2012-06-07 07:14:09 PM

Debeo Summa Credo: ghare: jjorsett: Sergeant Grumbles: jjorsett: People biatch about businesses not hiring and sitting on their cash, but business decisions have 5-to-7-year time quaterly horizons

FTFY

Shareholders might have those kinds of timelines, but the people running the business can't. You don't build a new plant or open a new store and expect it to show up as profit on the bottom line in 3 months. And nobody is going to do those things when they don't know what their tax rates are going to be next year, or what new 10-volume set of regulations they're going to be expected to comply with next month.

You know, you should really get a big dose of reality. The people running companies big enough to have stockholders do not care about 7 years from now, because they have no plans to still be there. And in every business case, a small percentage of difference in the tax ON THEIR PROFITS is irrelevant.

But naw, I guess you think the government should guarantee that taxes and everything else will never ever ever change, no matter what is happening to the country?

Taxes and regulations dont affect business decisions. This is what farklibs actually believe.


i18.photobucket.com
Actually, nobody believes that.
 
2012-06-07 07:23:26 PM

jjorsett: ghare: But naw, I guess you think the government should guarantee that taxes and everything else will never ever ever change, no matter what is happening to the country?

You've got the tax and regulatory regime you seem to want right now. Nobody knows what the hell tomorrow is going to bring and they're acting predictably, namely sitting it out. If your goal was economic stasis, high unemployment, and stagnation, you certainly got your wish. How that's a good thing I'll leave to you to explain.

Personally, I'd move away from a system in which business people are continually mystified about what might hit them next and are assured enough stability that they can make rational plans, but maybe that's too much to ask of you types who worship The State and all it stands for.


Well, it certainly seems to be to much to ask the noisy coalition of reactionaries who appear intent upon taking our country back a couple of hundred years.They refuse to compromise, and have clearly stated their intention to break America if they can't have it their way. Most rational Americans are nervous about these people, and I'm quite certain the business community is too.
 
2012-06-07 07:37:53 PM

jjorsett: Nobody knows what the hell tomorrow is going to bring and they're acting predictably, namely sitting it out.


That doesn't sound right. Right-wingers are demanding less taxes tomorrow than they're paying today. When tomorrow arrives, they will never concede that they are paying enough taxes or, god-forbid, not enough taxes. They will always demand tax cuts. Always. Until it's a trillionth of a cent, and even beyond that, they will demand tax cuts. This is the reason why the biggest myth in the right-winger pantheon is that of the bloated, inefficient government with its overpayed, underworked employees. I can't wait until the right-wingers take control of every aspect of life and eliminate the entire civil service, or at least gut it to the point that nothing credible remains. I can't wait.
 
2012-06-07 08:10:47 PM

Debeo Summa Credo: LasersHurt: Money moving and being spent stimulates the economy and creates value. It's of little consequence if it's the government or citizens - so long as money moves, instead of sitting, it's probably going to help.

(Note that it does have to be broad-based, too, but I figure that's a given).

Where does the money sit? Do you think it's put in a vault?


Don't be so literal.

Although it would be cool if we had a giant, comical vault somewhere.
 
2012-06-07 08:14:21 PM

TyrantII: Subby, you do know a lot of money is made when the stock market goes down, right?

Institutional investors and day traders like volatility, not stability. They stand to make a lot more money on placing the right bets when markets are swinging. Long term investment is for chumps in today's markets, same as in today's boardrooms.


I would love to see a rule implemented to where you must hold stock for 90 days before you would be allowed to sell it. That one simple item would change the entire game,

Too bad it would never happen...
 
2012-06-07 08:24:25 PM

Slives: I would love to see a rule implemented to where you must hold stock for 90 days before you would be allowed to sell it. That one simple item would change the entire game,

Too bad it would never happen...



Nevermind that the whole point of buying stock in a company was to provide capital to a business who needed it and in return receive a portion of the profits back for your investment. Now it's all about micro-trading in fractions of a second to pull millions out of nowhere in the blink of an eye, and the magicians don't want everyone to see their tricks.

It doesn't even have to be 90 days. Making it one day would go far.
Or adding a tax on each stock traded.
Bottom line is that the stock market produces no real value, no tangible value, and needs to be severely curtailed from being an engine of our economy.
 
2012-06-07 08:28:54 PM

Debeo Summa Credo: Taxes and regulations dont affect business decisions. This is what farklibs actually believe.


Taxes shouldn't, for the most part, since they don't affect operations.
 
2012-06-07 08:40:09 PM
Only cowards hiding from their own shadow can blame "uncertainty" for inaction.

Entrepreneurs (bootstrappy or otherwise) don't waste time worrying about a few points in the tax rate or the regulatory climate when they take bold risks in pursuit of greatness.
 
2012-06-07 09:14:10 PM

Cubicle Jockey: Debeo Summa Credo: Taxes and regulations dont affect business decisions. This is what farklibs actually believe.

Taxes shouldn't, for the most part, since they don't affect operations.


The affect after tax return on capital, which affect capital allocation decisions
 
2012-06-07 11:40:50 PM

Debeo Summa Credo: The affect after tax return on capital, which affect capital allocation decisions


Hence the "most part".
 
2012-06-08 01:09:23 AM
Someday subby will grow up and try to support a family with a job, not on the parent's handouts, or other dole. Maybe subby will have a 401k, if they haven't taken all the money from them and given you some annuity by then.
 
2012-06-08 02:08:58 AM
5-10% inflation is the answer because it means to either invest or lose significant values on your cash holdings. Cash is way overweight in private firms right now.
 
2012-06-08 07:09:29 AM

nobodyUwannaknow: Only cowards hiding from their own shadow can blame "uncertainty" for inaction.

Entrepreneurs (bootstrappy or otherwise) don't waste time worrying about a few points in the tax rate or the regulatory climate when they take bold risks in pursuit of greatness.


LOL.

Yeah, we don't know how ACA will affect the insurance market, we havent even read Dodd Frank ourselves so have no idea how that will be implemented or how it wil affect your industry, we don't know what the corporate tax rate will be and the president has mused about greatly increasing the tax on investments but lord knows if that idea has any legs or is dead in the water.

But go ahead mr entrepreneur, jump in with both feet right now. If you don't, you're a pussy.
 
2012-06-08 09:16:42 AM

Debeo Summa Credo: Yeah, we don't know how ACA will affect the insurance market,

You could read the bill, or look at any of the predictions. Quite alot of them say that healthcare cost increases will be slowed or eliminated, which is much better than the "status quo" of skyrocketing costs with no limiters.
we havent even read Dodd Frank ourselves so have no idea how that will be implemented or how it wil affect your industry
Well, Mr. Brave Captain of Industry, you'd better get on that, shouldn't you? Your ignorance isn't any excuse for inaction.
we don't know what the corporate tax rate will be
A valid point, but there don't seem to be any plans to greatly increase the corporate tax unless you're listening to the right wing blogosphere, and official plans seem to lean towards lowering the rate and eliminating loopholes. So while valid, this isn't a good reason to halt business expansion.
and the president has mused about greatly increasing the tax on investments but lord knows if that idea has any legs or is dead in the water.
Taxes on investments have little to do with expanding businesses, which aren't taxed on operating or expansion costs. If you're trying to say businesses won't be able to expand because they get no new investors, big business is already sitting on mountains of unused cash, and small businesses don't rely on those kind of investors.

So yes, we have a very favorable business climate and the only reasons not to jump in with both feet is ignorance, stupidity, or partisanship. You'll rarely find a workforce so eager (and desperate) for work,
 
2012-06-08 01:47:23 PM

Sergeant Grumbles: Debeo Summa Credo: Yeah, we don't know how ACA will affect the insurance market,
You could read the bill, or look at any of the predictions. Quite alot of them say that healthcare cost increases will be slowed or eliminated, which is much better than the "status quo" of skyrocketing costs with no limiters.
we havent even read Dodd Frank ourselves so have no idea how that will be implemented or how it wil affect your industry
Well, Mr. Brave Captain of Industry, you'd better get on that, shouldn't you? Your ignorance isn't any excuse for inaction.
we don't know what the corporate tax rate will be
A valid point, but there don't seem to be any plans to greatly increase the corporate tax unless you're listening to the right wing blogosphere, and official plans seem to lean towards lowering the rate and eliminating loopholes. So while valid, this isn't a good reason to halt business expansion.
and the president has mused about greatly increasing the tax on investments but lord knows if that idea has any legs or is dead in the water.
Taxes on investments have little to do with expanding businesses, which aren't taxed on operating or expansion costs. If you're trying to say businesses won't be able to expand because they get no new investors, big business is already sitting on mountains of unused cash, and small businesses don't rely on those kind of investors.

So yes, we have a very favorable business climate and the only reasons not to jump in with both feet is ignorance, stupidity, or partisanship. You'll rarely find a workforce so eager (and desperate) for work,


Businesses don't know how they'll respond to ACA because they don't know how competitive the exchanges will be and whether they'll be in a position to stop offering coverage because of the availability of insurance on the exchanges.

Dodd frank is still in the implementation stage - businesses can't react when the regulators empowered under Dodd frank will implement it.

Who are the SIFIs going to be? Nobody knows, and nobody knows what the ramifications will be because they haven't been decided yet.

You are clueless about the regulations you support, so how can you be so obtuse as to argue what their effect will be on the business community?
 
2012-06-08 03:58:24 PM

Debeo Summa Credo: You are clueless about the regulations you support, so how can you be so obtuse as to argue what their effect will be on the business community?


And business owners seem clueless about the regulations they're against, so how can they be so obtuse as to argue what their affect will be on the business community?

Works both ways, and we already have an insanely favorable business climate. The people refusing to expand aren't doing so for sound business reasons.
 
2012-06-08 05:07:02 PM

Debeo Summa Credo: Sergeant Grumbles: Debeo Summa Credo: Businesses don't know how they'll respond to ACA because they don't know how competitive the exchanges will be and whether they'll be in a position to stop offering coverage because of the availability of insurance on the exchanges.


Businesses that currently offer insurance already know those costs and the rate of increase over the last several years. They know from the bill what their tax incentives will be. They ought to be able to make a reasonable projection.

Dodd frank is still in the implementation stage - businesses can't react when the regulators empowered under Dodd frank will implement it.

Dodd Frank impacts financial institutions, and believe me they're studying the law carefully. What does it have to do with the rest of the private sector?

Who are the SIFIs going to be? Nobody knows, and nobody knows what the ramifications will be because they haven't been decided yet.

Basel III is also being closely studying by the financial industry. Again, what does this have to do with the rest of the private sector. Perhaps you're suggesting that increased banking regulation will lead to increased costs of doing business with banks, which may be true but the costs will be spread across millions of customers not restricted to businesses.

You are clueless about the regulations you support, so how can you be so obtuse as to argue what their effect will be on the business community?

You don't seem to be particularly clued in yourself, you simply have a knee jerk reaction that the reason for the stagnant job market is that Fartbongo has issued too many job killing regulations. That's an ideology, not an economic analysis.
 
2012-06-08 05:18:37 PM

Stile4aly:

You don't seem to be particularly clued in yourself, you simply have a knee jerk reaction that the reason for the stagnant job market is that Fartbongo has issued too many job killing regulations. That's an ideology, not an economic analysis.


Well, that and a bald-faced lie.
 
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