Signs of Life?

On Wednesday, I wrote of caution with regard to Tuesday's stock market rally and CitiGroup's indication that they saw themselves as being profitable in January and February. I said that CitiGroup's profitability isn't necessarily transferable to the rest of the industry. Well, apparently others in the banking industry are seeing similar benefits from having received government bailout money last fall. On Wednesday, JP Morgan/Chase said that they, too, were seeing a turnaround; not just for them but, the whole banking industry (See Full Story). Then, today, Bank Of America seemed to echo what Citi and Chase were saying (See Full Story).

Armed with all the banking information and today's fact that Retail Sales were only down slightly last month (See Full Story) the stock market has been able to muster a 3-day rally.

This rally may be short lived or it could actually be the start of a recovery. I just don't know. I guess it will depend on what news we'll see in the future.

One thing, though, it shows that the rush to get the Stimulus Package passed may have been premature. The limited signs of economic life that we are now seeing have nothing to do with the Stimulus Bill. Actually, the cash outlays for the package are still just now starting to get off the ground. And, today, Obama, himself, admitted that things might not be as bad a previously thought (See Full Story).

I think this just proves that Obama was using the situation to push a social agenda through Congress. His thoughtless spending of a near trillion dollars may not have been needed. Leastwise, on the emergency basis that he kept claiming throughout all of January and February. Most recessions self-heal themselves in 16 to 20 months and we are right at about that point now. I think this further proves that maybe Nancy Pelosi' drive to have a second stimulus before this one has even had a chance to work is totally unwarranted.

It appears, once again, the kids have the keys to our car!

Rough Seas Ahead?

Right now, Mr. Obama has loaded up his incoming Administration with ex-Clinton people. Apparently, Barack thinks life was great under Bill Clinton and wants to revive the feeling of those dot-com boom years that Clinton actually had nothing to do with. Before anyone gets too euphoric, just take a look at one of the key people that supposedly handed this country such a great economic ride during Bill's great adventure as President. That person was Bill Clinton's former Treasury Secretary, Robert Rubin.

Now, after being the senior economic adviser and board member to Citi Group/Bank, he has been forced to resign with a trail of $20 billion in losses to that company (See Full Story).

There appears to be a misconception that the Clinton years were perfect. They weren't. Clinton never was able to close a deal on the Palestine/Israeli tensions. He let Bin Laden slip through his fingers and strengthen operations in Afghanistan. The economy was good under Clinton but by no effort on his part. He road the wave of the dot-com boom until that bubble burst and the economy slipped into recession. Anyone knows that most any ship's crew can sail a boat in calm seas. But it is completely different in rough waters and in high seas. We are in high seas, now, and I just don't think these former Clinton people have the true experience to get us to a safe harbor. Just my opinion.

And, by the way. Before I get any emails pointing to the mess we are into today and how it is all Bush's fault, I would suggest you look at the real history of how the "cheap" housing credit situation came to be in this country. The problem had be brewing as a result of legislation that goes all the way back to the Carter Administration and was given further fuel under Clinton. Bush knew the problem was there and pointed it out in speeches going back to 2001. If Bush is to be blamed for anything, it is for his failure in being a more forceful manager and "red-flagger" on this specific issue. That's a burden of blame that his legacy will carry forward.