Even as stock market indexes drop in unison on Obama’s Inauguration Day, our spirits were up. Weren’t you uplifted by yesterday’s presidential address?
It’s a new beginning for America, and I’ve never been more hopeful. This goes down as one of the most invigorating and refreshing speeches I’ve heard in a good long while (I’m sure there’ll be many more where it came from). Even my father, who is visiting from abroad and who isn’t a citizen proclaimed: “That brought tears to my eyes, and I’m not even American!” It’s good to know we’ve got a new president who can elicit such moving and positive emotions from the rest of the world. Just good to know.
Yesterday’s spirit-rousing events didn’t help the stock market though, which had a mind of its own. The Dow Jones index dove 4 percent yesterday to just under 8,000. Other indexes fell by bigger percentage points with the S & P down by 5.28% and the Nasdaq down by 5.78%. Ow.
Just as Obama made history, so did the stock market, by marking this movement as the largest Inauguration Day drop for the Dow in its entire 112 history. Just check out some historical index closings during past inaugurations:
Historical Dow Closings on Presidential Inauguration Days
|President||DJIA||Point Change||% Change|
|George W. Bush (second term)||10489.94||-50.03||-.47%|
|George W. Bush (first term)||10887.36||299.77||2.83%|
|Bill Clinton (second term)||6813.09||-20.01||-0.29%|
|Bill Clinton (first term)||3310.03||54.04||1.66%|
|George H.W. Bush||2342.32||103.21||4.61%|
|Ronald Reagan (second term)||1286.77||59.41||4.84%|
|Ronald Reagan (first term)||947.27||-23.72||-2.44%|
One thing jumped out at me here — do you see where the Dow Jones stands today compared to past Dow closings? Seems like public confidence fell hand in hand with the stock market over the last 8 years.
Why Did Stock Market Indexes Drop?
Now should we be puzzled by yesterday’s market behavior? Not really, since the performance of the markets wasn’t really tied to what was going on in Washington yesterday. The markets only respond to news that it sees as relevant to the financial community, and in this case, the last few days were fraught with negativity and worry, as investors continue to fret and fixate over the state of vulnerable banks:
U.S. financial losses from the financial crisis may reach $3.6 trillion, according to New York University Professor Nouriel Roubini, who predicted last year’s economic and stock-market meltdowns. He says: “If that’s true, it means the U.S. banking system is effectively insolvent because it starts with a capital of $1.4 trillion. This is a systemic banking crisis.”
So are we broke? We very well could be, but we remain hopeful that somehow we can turn this mammoth of a mess around. Because we really can’t afford to be anything but hopeful — it’s all we have at this point. Besides, we’ve got Obama at the helm, right? Let’s see what he can do. Hail to the new Chief!
On to other financial news!
Personal Finance Articles
- The Wallet: Putting Credit Card Regulations on the Fast Track
- All Financial Matters: ShamWow = ScamWow?
- Lazy Man and Money: The Best Money Blog You Aren’t Reading
- Generation X Finance: As Your Tax Documents Arrive in the Mail, Begin to Get Organized and Don’t Procrastinate
- Brip Blap: Looking Through New Eyes
- Million Dollar Journey: 6 Reasons Why Recessions Are A Good Thing
- Money Smart Life: Five Ways I’ve Failed Myself (And What I’m Going to Do About it)
- My Dollar Plan: How Long Do We Really Need To Keep Those Papers?
- The Sun’s Financial Diary: Can Debit Cards Protect Consumers Against Fraud?
- Frugal Dad: Dust Off Your Magnifying Glass to Be Frugal and Still Enjoy Life
- Rich Credit Debt Loan: Starting Kids Out On The Right Financial Track
- Carnival of Personal Finance
- Festival of Frugality
- Money Hacks Carnival
- Comics and Cents
- Carnival of Personal Development
- New Dawn Best of Me Symphony
- Total Mind and Body Fitness Carnival
- Carnival of Debt Reduction
- Carnival of the Green
Copyright © 2009 The Digerati Life. All Rights Reserved.