In other words go short anything that Obama pushes then wait until Congress screws things up and then you can go back long again. I did this with the Health Insurers by going short them when Health Care nationalization talk heated up. Then I covered and went back long as the debate wore on and took profits on the news that the Senate might strip the public plan out of the bill. Trading off Obama is sometimes quite lucrative.
Since then, the bankruptcy bill has fizzled and nationalization talk has died out. President Barack Obama did sign a credit card bill into law, but its provisions were much weaker than the industry feared.
Separately, healthcare reform has slowed while a climate change bill imposing taxes on businesses that emit pollutants has stalled in the Senate.
Stock markets, meanwhile, have rallied to their highest levels of the year. The Standard & Poor’s 500 Index began this week within striking distance of 1,000 points.
“It’s very much a factor in what’s driving the market over the last couple weeks,” Gardner said of the slowed agenda in Washington.
I think it has more to do with certainty going back into some sectors of the market that came from paying back the TARP money so quickly. Now traders can trade in peace without the government telling them what they should be paid or some uninformed person telling them about the Profit and Earnings Ratios of the market.
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