The Curious Case of the Obama Economy

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Your humble blogger was distressed by this little ditty from Reuters yesterday:
Thu May 5, 2011 2:18pm

Oil plunged more than 8 percent on Thursday, heading for the third biggest daily drop in dollar terms on record, as concerns about economic growth and monetary tightening spurred a sell-off in commodities.

U.S. crude tumbled below $100 a barrel in heavy trading volume after weak economic data from Europe and the United States fed concerns that have battered commodities all week. German industrial orders fell unexpectedly in March while U.S. weekly jobless claims hit eight-month highs.

…Crude oil is selling off sharply for two primary reasons: QE2 is coming to an end in June and without a QE3 behind it, it will take liquidity out of the market, hurting risky asset classes such as commodities,” said Chris Jarvis, senior analyst, Caprock Risk Management in New Hampshire.

Wow, that sounds pretty bad.
And yet a mere 18 hours later, Reuters published this:
Fri May 6, 2011 10:15am

U.S. private employers shrugged off high energy prices to add jobs at the fastest pace in five years in April, pointing to underlying strength in the economy, even as the jobless rate rose to 9.0 percent.

…U.S. stock index futures extended gains, while U.S. bond prices extended losses. The dollar rose further against the euro and yen.

The unemployment rate has dropped a full percentage point since November and the latest rise will strengthen the Federal Reserve’s resolve to stick to its ultra-easy monetary policy stance.

The Fed last month signaled it was in no hurry to start withdrawing its massive stimulus for the economy, even as other major central banks around the world have begun to raise interest rates.

I consider myself well versed in finance, but there are some things about this I cannot figure out. How did Ben Bernanke change his mind overnight? Is oil going down because of a strong dollar or a troubled dollar? And if Wall Street finance gurus are the ones who messed up everything in 2008, then why do we keep taking their opinions as gospel?
Can someone help me out here?

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0 responses to “The Curious Case of the Obama Economy

  1. Spin spin spin.
    The media whores are spinning for this administration, it’s dizzying.

  2. I don’t trust any of them. And by the way, rumor is Soros dumped on gold and silver this week; which is probably why both took a dive today.

  3. OK, the Soros story turns out to be true. below is the link to money news with the article.

  4. Linda,someone needs to catch up with soros really bad.


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