In IBD, Jack Kemp and Peter Ferarra write, “Are Barack Obama’s proposed tax increases adversely affecting our financial markets? We say yes, unambiguously.” What follows is a very strong case for why investors should be concerned with Obama’s tax plans and why they will be bad for investors, but there is nothing else to support their unambiguous claim that the tax plans currently are affecting the markets. I write this because I’ve seen a number of conservative authors try to argue that the market downturn is somewhat attributable to investor fears about an incoming Obama administration, yet nobody offers any evidence to support that claim. Back when I was a financial reporter, we couldn’t assert that something was hurting the market unless we had actual traders, stock analysts, or investors on record saying that it was, no matter what the correlatory evidence. And I think that’s a good rule of thumb to follow. For what it’s worth, my sense is that there probably is investor trepidation about Obama, which is part of a broader concern about the dirth of competent national leadership on the economy, but given the complexity of the markets and the magnitude of the credit crisis, I’m not sure how much of an affect the presidential race is having. But that’s just my best guess, I wouldn’t say it’s “unambiguously” true without doing reporting.
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