Delaying Tax Vote Could Crash Stock Market

http://politics.usnews.com/news/blogs/washington-whispers/2010/12/2/delaying-tax-vote-could-crash-stock-market.html

at this point, any number of rationalizations could "crash" the stock market. the market is probably going to crash anyways, based on investors' extreme optimistic sentiment. There are so many bulls already invested that it will be difficult to find new money to drive the market higher. And those already invested have done so with a high degree of leverage that requires higher returns than the market can continue to provide for much longer.

social mood in a downward wave of major degree predisposes politicians (and their political bases) to reject compromises and coincidentally predisposes equities to "crash". moderates will appeal to compromise and blame a "crash" on lack of compromise. true believers will reject a compromise and claim that the crash came because the compromise was a lousy deal.

notice that Obama, not Congress, came out proposing a deal (in principle, no actual legislative language yet). and in his statement he fretted that there are those on both his left and his right that are reluctant to deal. (Obama is playing the moderate triangulator, just like Clinton did after midterm losses in 1994.)

whatever you think of Obama and the supposed deal on extending tax cuts, the overall picture is that Obama is trying to play the moderate, while legislators of both parties are trying to appeal to true believers. moderates' time to shine is in upward trending cycles, while true believers prevail in downward trending cycles. since our EW analysis predicts that 2011-12 will be a downward primary wave 3 of downward cycle degree C of downward supercycle degree A, it is likely that Obama will not successfully endear himself to the electorate as a moderate.

that Obama would attempt this strategy is socionomically understandable as the upward primary degree 2 reaches its climax. but contrary analysts understand that the trend will not continue. and a strong downward wave, favoring confrontation over moderation, will reassert itself from now until his (failed) reelection attempt.




One indicator of Obama's trouble is (and will increasingly be) the prominence of "Miss Me Yet?". Yes, George, we do miss you badly. Now more than ever!!

Democrats losing Independents

Republicans are supporting Republicans and Democrats are supporting Democrats, but the Independents who determine elections are breaking decidedly towards the Republicans (even in Democratic polls).

Given the roughly equal numbers of registered Democrats and registered Republicans, independents are the closest measure of the median (center) position of political thought in America. (Since 40% of Americans are conservative and only 20% of Americans are "liberal" or leftist, the remaining 40% that identify as "moderate" do not straddle the center, but rather skew to the left.)

http://sas-origin.onstreammedia.com/origin/gallupinc/GallupSpaces/Production/Cms/POLL/w738nquazegahfq5xajfxa.gif

As Democrats and Republicans have similar proportions nationally, independents are a far more center-based group than left-leaning "moderates".

http://sas-origin.onstreammedia.com/origin/gallupinc/GallupSpaces/Production/Cms/POLL/b8scyp6bruqgez4snjxqdg.gif

On Gallup's generic congressional ballot question, Independents (among registered voters) would prefer to vote for a Republican rather than a Democrat by a margin of 47-34. Among all registered voters, voters would prefer a Republican by a margin of 49-43. This represents the highest preference for Republicans in 48 years of Gallup polling history. Even in 1994 and 2002, the margin was only 5 points in Republicans' favor among registered voters. (Often registered voters skew more Democratic than those who actually show up on election day, especially in non-presidential years. Hence, the preferred method among many pollsters is to screen for LIKELY voters, not simply registered voters. Likely voters tend to lean even more pro-Republican than do registered voters.) Evidence suggests that 2010 may be even a more pro-Republican year than 1994 or 2002 or any other year since Gallup began asking this question in 1962.

http://www.gallup.com/poll/127439/Election-2010-Key-Indicators.aspx

But does the mood favor not just Republicans in general, but specific Republicans in specific races? Congressional polling is harder to find and is not often released publicly this far in advance of election day. But numerous statewide senate polls have been conducted and do confirm a shifting of the general electorate and Independents in particular toward Republicans.

Using the most recent publicly available statewide polling data from one particular Democratic polling firm (Public Policy Polling), we find that Republicans more often than not lead Democrats among independents -- sometimes by commanding double-digit leads.

Among independents:

Ky: Rand Paul (R) leads Conway (D) 44-29

MO: Roy Blunt (R) leads Carnahan (D) 47-35

NC:
Burr (R) leads Cunningham (D) 41-32
Burr (R) leads Marshall (D) 40-38

CO:
Bennet (D) leads Norton (R) 42-40
Buck (R) leads Bennet (D) 40-39
Bennet (D) leads Wiens (R) 39-35
Norton (R) leads Romanoff (D) 40-35
Buck (R) leads Romanoff (D) 36-34
Romanoff (D) leads Wiens (R) 35-33

OH:
Portman (R) leads Fisher (D) 37-25
Portman (R) also led Brunner (D) 37-25

PA:
Sestak (D) leads Toomey (R) 35-34
Toomey (R) led Specter (D) 41-38

IL: Kirk (R) leads Giannoulias (D) 33-30

NV:
Lowden (R) leads Reid 62-27
Tarkanian (R) leads Reid 55-30
Lowden (R) leads Berkley 55-24
Tarkanian (R) leads Berkley 53-27
Lowden (R) leads Goodman 48-30
Tarkanian (R) leads Goodman 50-30
Lowden (R) leads Miller 51-19
Tarkanian (R) leads Miller 50-18

AR:
Boozman (R) leads Lincoln 66-20
Boozman (R) leads Halter 56-18

NH:
Ayotte (R) leads Hodes (D) 49-34
Binnie (R) leads Hodes (D) 46-36
Binder (R) leads Hodes (D) 39-37
Lamontagne (R) ties Hodes 38-38

FL: Crist (I) 35 - Rubio (R) 24 - Meek (D) 22

Based on this sample of polls, top priorities for conservatives, Republicans, and friends of liberty would be Pennsylvania (Pat Toomey) and Illinois (Mark Kirk) and Colorado (nominee yet to be determined). Mark Kirk may not be the ideal candidate, but we are so close to electing a new Republican majority in BOTH houses of Congress that we need to keep our eyes on the prize. As flawed a candidate as Kirk may be, he is so much better than the mob banker Alexi Giannoulias.

http://www.toomeyforsenate.com