Is Barack Obama a Wall Street Wizard?
Ken Layne
Contributor
Posted:
06/1/09
Barack Obama means different things to different people. Kids say he's the "cool uncle" who plays basketball and wears fancy sunglasses. Adults know him as the popular new president of the United States. And some old nuts here and there who listen to AM talk radio are certain Obama is some kind of evil space alien who will bring prosperity and education to the nation.
But few people know that Barack Obama used to be a financial researcher and business writer in Manhattan. He wrote all about his work in the investment industry in his bestselling book Dreams From My Father, but America is not exactly a country full of "book learners."
Too bad for America! Had personal investors followed Obama's stock market advice in March, they would've seen returns of more than 30% in just three months!
According to the important economic news website Marketwatch, "An investor who followed the advice the president gave on March 3 and plowed money into U.S. stocks that day would be sitting pretty now. After slumping for a few more days, the Standard & Poor's 500 Index began a ferocious rebound."
Since Obama's tip to long-term investors, the benchmark S&P shot up 32%.
Math is hard, but experts say this means if you put $10,000 into an index fund that tracks the S&P 500 on March 3, today you would have earned around $3,200 -- over just three months!
Compare that to a money market account, where you might earn a couple hundred dollars on 10K over a whole year.
How is Obama so smart about the money? It is because he follows a strange, un-American logic known as "buy low, sell high." Mixed with the equally weird philosophy of "buy and hold," the idea of purchasing equities when prices are quite low compared with earnings seems to reward investors who don't freak out over everything all the time.
But what do we call the meditative nerds who don't freak out whenever the stock market goes through one of its cyclical boom-bust flameouts? How can words describe a Freak of Nature who doesn't go insane when the 401k he won't need until 2029 drops 35% during the collapse of an all-too-common asset bubble?
These people are called "contrarians," according to Marketwatch.
Contrarians listen to Barack Obama, the friend of Warren Buffett and the Oracle of the White House.
Ken Layne is editor of Wonkette, the Washington journal of policy and finance.
But few people know that Barack Obama used to be a financial researcher and business writer in Manhattan. He wrote all about his work in the investment industry in his bestselling book Dreams From My Father, but America is not exactly a country full of "book learners."
Too bad for America! Had personal investors followed Obama's stock market advice in March, they would've seen returns of more than 30% in just three months!
According to the important economic news website Marketwatch, "An investor who followed the advice the president gave on March 3 and plowed money into U.S. stocks that day would be sitting pretty now. After slumping for a few more days, the Standard & Poor's 500 Index began a ferocious rebound."
Since Obama's tip to long-term investors, the benchmark S&P shot up 32%.
Math is hard, but experts say this means if you put $10,000 into an index fund that tracks the S&P 500 on March 3, today you would have earned around $3,200 -- over just three months!
Compare that to a money market account, where you might earn a couple hundred dollars on 10K over a whole year.
How is Obama so smart about the money? It is because he follows a strange, un-American logic known as "buy low, sell high." Mixed with the equally weird philosophy of "buy and hold," the idea of purchasing equities when prices are quite low compared with earnings seems to reward investors who don't freak out over everything all the time.
But what do we call the meditative nerds who don't freak out whenever the stock market goes through one of its cyclical boom-bust flameouts? How can words describe a Freak of Nature who doesn't go insane when the 401k he won't need until 2029 drops 35% during the collapse of an all-too-common asset bubble?
These people are called "contrarians," according to Marketwatch.
Contrarians listen to Barack Obama, the friend of Warren Buffett and the Oracle of the White House.
Ken Layne is editor of Wonkette, the Washington journal of policy and finance.