Capital Commerce


October 2006


Political Gridlock May Not Be So Good

A month ago at this time, political analyst Mark Melcher was "moderately confident" that the Republicans would hold the House and Senate. Today, Melcher, who for years tracked politics and policy for a major Wall Street investment firm and now puts out the Political Forum newsletter (a must-read ...

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A Bad Time to Return to Rubinomics?

Democratic candidates have been running as fiscal hawks this election season, lambasting Republicans as a bunch of free spenders who mismanaged the Clinton surpluses into the Bush deficits. It seems as if they are arguing for a return to Rubinomics, the economic theory named after President ...

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Ask Sallie Who Will Win the Midterms

Today's GDP number was the last big economic report before the election. But that top-line number showing that growth slowed to 1.6 percent from May to September vs. 2.6 percent in the previous quarter isn't the one to watch–at least not if you are trying guess what voters will be thinking on ...

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Wall Street's Take on the Midterm Elections

What is Wall Street's perspective on what might happen November 7? Here are the key takeaways from a Prudential Securities conference call held yesterday by the firm's Washington research term.

  • There's a 2 in 3 chance of the Democrats' taking the House and a 45 percent chance of their taking the ...
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    Bernanke's 12 Big Words

    "Going forward, the economy seems likely to expand at a moderate pace." Those dozen words constitute almost the entire difference in the Federal Reserve's policy statement today and the one issued last month. (This statement also downplays energy prices as a source of inflation.) And like last ...

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    Is Good Economic News Good for Democrats?

    So which game is the chairman of the White House's Council of Economic Advisers playing? In a newspaper interview published today, Edward Lazear said that the housing slowdown will affect "a very significant chunk" of the economy's growth in the third quarter–3Q GDP comes out Friday–and that the ...

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    The Budget's Missing $240 Billion

    By all accounts, Republicans—including President Bush—are going to start talking up the economy big time as a way of improving their chances of holding on to one or both houses of Congress. And there's a lot of meat to their argument, what with the Dow Jones industrial average climbing to new highs ...

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    A GOP Surprise Courtesy of Investors?

    If you go by the political betting markets—not to mention those devastating polls—the GOP has about the same chance (30 percent or so) of keeping House of Representatives under Republican control as the United States does of catching Osama bin Laden or of bombing Iran by the end of next year. (But ...

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    Why Wall Street Doesn't Fear Speaker Pelosi

    It seems ever more likely that the Democrats will capture one or possibly both houses of Congress. But the Big Money crowd on Wall Street seems as if they couldn't care less. The Dow Jones industrial average is up 2.3 percent since the Mark Foley scandal broke, an event reversing a monthlong ...

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    An Economic Agenda for Republicans

    No matter what happens on November 7, America is going to end up with a de facto divided government. Even should the GOP keep control of the House and Senate, it would likely be by the narrowest of margins. Most analysts think voters should expect nothing but gridlock for the next two years. So for ...

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    An Economic Agenda for Democrats

    If the public-opinion polls and online betting markets are correct, Democrats will be running one or both houses of Congress come Jan. 3, 2007. But if that moment does arrive, will their congressional leaders find themselves repeating the famous question asked at the end of the 1972 Robert Redford ...

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    Should Uncle Sam Help Domestic Manufacturers?

    A recent study from the National Association of Manufacturers claims that the competitiveness of domestic companies is being hurt by rising "structural costs." Problem areas include taxes, employee benefits, litigation expenses, and energy prices. As the NAM figures it, U.S. manufacturers are at a ...

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    October Surprise for the Investor Class

    How will investors affect the midterm congressional elections on November 7? (That was the cogent question asked of me by Lawrence Kudlow when I appeared on yesterday afternoon's edition of CNBC's Kudlow & Company.) To even begin to tackle the issue beyond a sound bite, you first have to understand ...

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    Those Strange Jobs Numbers

    It was the big twist in last week's so-so jobs report. Labor Department number crunchers said they had–oops!–undercounted by a whopping 810,000 the number of jobs created by the U.S. economy for the 12 months ending in March 2006. That means nearly 3 million new jobs were created instead of just ...

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    Is '70s-Style Stagflation Next Up for the U.S. Economy?

    Gail Fosler, chief economist of the Conference Board, came out with her stagflation call this morning. Oh, and the Fed is also going to resume raising rates, she added. Ugly stuff. The global research organization's index of leading economic indicators has turned downward of late, leading to ...

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    A Surprise in the Job Numbers?

    Will tomorrow's September payroll numbers from the Labor Department provide a big surprise? That's certainly been the case in recent years. Economists have been unable to predict with any accuracy how many jobs this economy creates on a monthly basis. Usually the pros are overly optimistic,

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    Bernanke Speaks! (On Housing, Energy, Entitlements)

    Since chatting up Fed policy with CNBC anchor Maria Bartiromo at a dinner in April–sending stocks plunging–Federal Reserve Chairman Ben Bernanke has kept his public utterances formal. But speaking at the Economic Club of Washington today, Bernanke did take some audience questions after his ...

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    Fed may slash rates to save the economy

    "Apocalyptic."

    That's how a Wall Street economist described to me the attitudes of south Florida homebuilders to whom he recently gave a speech. The economist might have gotten a similar earful had he chatted with homebuilders in the Northeast or California. Same dreadful story in all the formerly ...

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    Why Bernanke should be smiling

    Another sign that the economy may be headed for a soft landing, rather than a hard one: today's September manufacturing report from the Institute of Supply Management–which showed the sector slowing a bit but still expanding. It was seen by economists as a sort of a tiebreaker after a series of ...

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