DOLLAR CRUMBLES After Obama’s Disappointing SOTU Performance

(US Dollar Index Future)

The dollar crumbled today after Barack Obama failed to convince investors that he was serious about reducing the record deficit in his State of the Union Address last night.
Forex Hound reported:

The U.S. Dollar fell against the major currencies after President Obama, during his State of the Union address, failed to convince executives and economists that he’s serious about controlling the U.S. budget deficit.

Although Obama did propose a partial freeze on government spending, many participants at the economic summit in Davos, Switzerland still felt the U.S. is lagging their foreign counterparts in cutting a record budget deficit of more than $1.2 trillion.

The opinions on Obama’s speech ranged from “There is an unwillingness to deal with the real gorilla in the room” according to Martin Sorrell, chief executive officer of advertiser WPP Plc to “We need a heck of a lot more action on it” and that Obama’s speech “lacked details” from James Turley, CEO of Ernst & Young LLP.

The major criticism is that the record budget deficit is one of the biggest risks to global economic growth. As it stands, the U.S. budget deficit is almost double the average in the Euro region. Borrowing costs over the past year have surged leading many experts to conclude that the budget deficit is unsustainable.

The AP added that the ledger did not appear to be adding up Tuesday night when President Barack Obama urged more spending on one hand and a spending freeze on the other.

#1 January 26, 2011 at 9:35 am
wheezer commented:

Lunacy in action…. Barrackonomics…..
#3 January 26, 2011 at 9:42 am
Militant Conservative commented:

This is by design. Buy gold or silver.
Definitely brass and copper.
Powder is dry.
#4 January 26, 2011 at 9:45 am
PJ commented:

But won’t the high speed trains solve the deficit??
#5 January 26, 2011 at 9:45 am
Andreas K. commented:

On the good side, you’ll get out of it.

Us in the EU… not so much. Greece is finally hitting the deck and we have to butter in even more money (I heard 440 billion Euros as a first number.)
#6 January 26, 2011 at 9:46 am
JimmyT commented:

World leaders have met him and know he’s an empty suit. Last night just confirmed that opinion. He’s in way over his head and appears lost. This is not good for the country. He’s not even smart enough to surround himself with good people to give him advice. If the pundits think this guy is smart, how dumb is dumb? Chris Matthews, Ed Shultz, Rachel Maddow, Allan Combs?
#7 January 26, 2011 at 9:51 am
∅ commented:

OC RDick will be here in a few minutes to explain the wisdom of duh one!
#9 January 26, 2011 at 9:56 am
olm commented:

That was possibly the worst SOTU speech he could have given. He really thinks people are not listening.
Well King of BS, they are listening and they aren’t buying a word of it.
He can go back to partying, he does less damage that way. Maybe relocate the WH to Hawaii. Look for the non existent birth certificate or something.
#10 January 26, 2011 at 10:04 am
NickDeringer commented:

Save your pennies, people, and support conservative candidates in 2012.
#12 January 26, 2011 at 10:13 am
Chippy commented:

Look for a major stock market correction very soon.
#13 January 26, 2011 at 10:18 am
The Oracle commented:

This is absolutely terrifying.
#14 January 26, 2011 at 11:06 am
Interesting commented:

In what should be titled “Dow Touches 12000 as Republicans Stop the Spending Spree” but is actually titled by the Leftist Media as “Dow Touches 12000 as New Home Sales Leap” we can see the response to yesterdays “GOP Spoils Obama’s SOTU Address – Pass Massive Spending Cuts… 165 Democrats Vote Against the Cuts” covered here on GP at: http://gatewaypundit.rightnetwork.com/2011/01/gop-spoils-obamas-sotu-address-pass-massive-spending-cuts-165-democrats-vote-against-the-cuts/

In the article it states:

The Dow hit the 12000 mark on Wednesday for the first time since June 2008 as the bulls cheered a surprise jump in new home sales…

Still, the modest rally nudged the blue chips above the psychologically-important 12000 mark for the first time since June 2008. The benchmark index first crossed this area in October 2006. The blue chips were also on track for their ninth weekly rally in a row, a feat Wall Street hasn’t accomplished since 1995.

“This run up has gotten a little long in the tooth, but every time I hear a bright investor calling for a move out of equities over the past 9 months, they have been wrong,” Peter Kenny, managing director at Knight Capital Group, wrote in a note.

==

They of course attributed it to the SOTU speech, not fiscal sanity and stopping the spending by the GOP when they said, “The markets appeared to benefit from President Barack Obama’s State of the Union address, where he struck a more conciliatory tone toward the business world. In an effort to cut $400 billion from the budget deficit over a decade, Obama proposed a five-year freeze on non-security discretionary spending. Obama also called for lowering corporate taxes, retooling the tax code and putting a stop to spending on pet projects.”

http://www.foxbusiness.com/markets/2011/01/26/futures-signal-green-start-fed-day/?test=latestnews

Note that they are conceding that the market is responding to CUTS, STOPPING the runaway spending and LOWERING TAXES. Who is the real champion of that position.. and hence the ones giving the shot in the arm to this Dow response by passing MASSIVE SPENDING CUTS yesterday?

You decide.
#15 January 26, 2011 at 11:10 am
No Man commented:

The definition of insanity. Do something. It does not work. Keep doing it ad infinitum ad nasaeum.

State of the Union = S.O.S. = Stuck on Stupid.
#16 January 26, 2011 at 11:20 am
Interesting commented:

Obama’s Spending Freeze Just ‘Spare Change’: Roubini
Published: Wednesday, 26 Jan 2011
By: CNBC.com
The White House plan to partially freeze government spending is just “spare change” compared to a budget deficit of more than $1 trillion and eventually the US will have to raise taxes, economist Nouriel Roubini of Roubini Global Economics told CNBC Wednesday.

President Barack Obama proposed a five-year freeze on non-discretionary defense spending for five year to lower the deficit by about $400 billion.

But more actions will be needed to seriously tackle the deficit, Roubini said at the World Economic Forum in Davos, Switzerland.

http://www.cnbc.com/id/41268003

WHO will take those actions necessary to tackling the deficit?
Are people really that easy to deceive?
Do they really believe this out-of-control, spending like a drunken sailor Administration can bring about solid prosperity?

See this morning’s GP post: “EPIC FAIL!… Obama Deficit Expected to Reach Record $1.48 Trillion”
http://gatewaypundit.rightnetwork.com/2011/01/historic-fail-obama-deficit-expected-to-reach-record-1-48-trillion/
#17 January 26, 2011 at 11:36 am
Interesting commented:

And here, they said in that “rosy” article praising the SOTU address that the new home sales had taken a sudden leap.. as stated above when it says, “The Dow hit the 12000 mark on Wednesday for the first time since June 2008 as the bulls cheered a surprise jump in new home sales…” and YET, today’s headline contradicts that with “New-home sales in 2010 fall to lowest in 47 years:

New-home sales in 2010 fall to lowest in 47 years
Buyers purchased fewest number of new homes last year in nearly half a century
Martin Crutsinger, AP Economics Writer, On Wednesday January 26, 2011

WASHINGTON (AP) — Buyers purchased the fewest number of new homes last year on records going back 47 years.

Sales for all of 2010 totaled 321,000, a drop of 14.4 percent from the 375,000 homes sold in 2009, the Commerce Department said Wednesday. It was the fifth consecutive year that sales have declined after hitting record highs for the five previous years when the housing market was booming.

The year ended on a stronger note. Buyers purchased new homes at a seasonally adjusted annual rate of 329,000 units in December, a 17.5 percent increase from the November pace.

Still, economists say it could be years before sales rise to a healthy rate of 600,000 units a year.

http://finance.yahoo.com/news/Newhome-sales-in-2010-fall-to-apf-452650344.html?x=0&.v=1

And yet they are touting this somewhat stronger note as a response to this Administration’s policies?
Are people really that gullible?
Do they enjoy being lied to?
Is good news all they want to hear.. even if it is FALSE?
Itchy ears needing scratching??
#18 January 26, 2011 at 12:06 pm
Over commented:

Isn’t that what the Global rulers hired him to do?
He’s just doing his job … i mean ‘following their command.”
#19 January 26, 2011 at 12:18 pm
#1 AMERICAN commented:

Barry Odumbo is doing exactly what the muslims wanted him to do….take down the USA inside out…NOT gonna happen BARRY….
#20 January 26, 2011 at 1:42 pm
Harry Schell commented:

How much would you like to bet Soros is shorting the dollar?

This is not going to be fun, and Republicans better get ready for hardball in the Congress.
#21 January 26, 2011 at 2:32 pm
Interesting commented:

ANOTHER proof of fiscal irresponsibility and the inability to actually STOP spending and that, therefore, the market was not responding to Obama’s speech at all:

Obama’s Plan Would Cost Another $20 Billion
Group says his proposals would lead to higher taxes
By Paul Bedard
Posted: January 26, 2011

Obama’s agenda spelled out in his well-received State of the Union address would boost spending an additional $20 billion and lead to higher taxes, according to a line-by-line analysis from the National Taxpayers Union Foundation. [See photos of the Obamas behind the scenes.]

“Obama’s speech last night hinted at tax reform, and spending restraint, but also opened the door to tax increases and major spending initiatives,” said NTUF Senior Policy Analyst Demian Brady. “Americans heard encouraging words about more efficient government, but little in the way of specifics about spending priorities. This leaves taxpayers wondering not only whether the federal budget deficit is headed upward or downward, but also by how much.”

In their report provided to Whispers, the foundation conceded that the $20 billion in additional spending was far less than the additional $70 billion in his last State of the Union where he also called for a budget spending freeze and earmark ban.

http://www.usnews.com/news/washington-whispers/articles/2011/01/26/obamas-plan-would-cost-another-20-billion

little in the way of specifics…

Hasn’t that been the mantra from the beginning.. don’t tell the people who Obama is or what he stands for.. or what you intend to do to them or their economy. But then.. if it is ONLY twenty billion and not 70, surely the people will be glad at such fiscal restraint.. and the markets should shoot up with glee.