The Bush Trade: RIP. Is There An Obama Trade?
The Bush Trade, which, in brief, entailed shorting the major market indices when President Bush began to speak publicly about the economy, and then closing the trade as he wound up his presentation, is a thing of the past. It made money around 80% of the time. When Bush spoke, a bet on the market going down was a good bet.
Let’s see if there’s an Obama trade to be had.
The first indication will come this afternoon, when Obama holds his first press conference as the President-Elect. Obviously the sample group (1 instance) will be too small to draw any conclusions from, but it’s the first of many.
If he can instill a confidence that W never could, it will be a small but essential step that needs to be taken if we hope to pull out of this recession before we’re pulled into an economic and psychological depression.
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You learn something new every day! Thanks for posting that LK, I had no idea they short sold on the back of a Bush speech? I know that the short-selling tactics are out of order but it did make me chuckle to think that G.W only had to speak to send the economy tumbling! I’m interested in the Obama effect now too! At the moment, however, I am totally at a loss to try and fathom out which way things are going to go now? I suppose it is too early to say and we will all find out more in time. One thing I do know, however, is that Obama is a Politician so I should be prepared for all outcomes! It’s all going to take time!
Ace post, as per usual m8
Peace
Short selling’s not out of order, but it is seen by some as being somehow evil in nature. in fact, it’s completely legal and has a checks and balance type effect when used properly and ethically. The lack of confidence in GWB as a leader was never clearer than when people were willing to back their feelings with their money.
too early to determine an Obama trade as, the market dove on the speech but rose back to close at the highs.
thanks for keeping in touch and please continue to do so.
LK