Amity Shlaes

Amity Shlaes: The Forgotten Man

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Four Trading Days In September

by Amity Shlaes
September 25, 2009

Here’s a recent column by me on whether markets rise when Congress is confused or inactive. Ali Wambold writes in recalling an event that seems to suggest “confusion = good”.  On Sept 18, 2008, Bloomberg carried a story announcing Congress would adjourn and that Senate Majority Leader Harry Reid said “no one knows what to do at the moment. ” 

Writes Ali: “When it looked like Congress was going to check out, the Dow rose over 770 points in 2 trading days, over 7% (the S&P500 rose about 8.5%).  Once Obama, McCain, Barney Frank and Chris Dodd (not a business person among them) checked in over that weekend, most of the gains were unwound in the following two trading days.”
 
The Wambold Suggestion: “We should consider having part-time legislators like the UK:  the less time they have to “do” things, the safer we are.”

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