This morning, the DOW and S&P 500 saw their worst one-day falls since June of this year. According to CNBC, part of this was due to concerns about Spain…but much of it was due to absolutely horrible third-quarter reports from American companies. From the article:
“Whether it’s guidance or revenue growth, there’s been much disappointment over the earnings season,” said Art Hogan, managing director at Lazard Capital Markets. “The difference today is that we’re seeing more pressure from Europe, which has been dormant…add to that the ongoing ‘fiscal cliff’ worry, and we have a combination of things pushing us lower.”
And from The Wall Street Journal:
This morning has been a bad one for U.S. corporate earnings, with a succession of companies releasing numbers that show a weak global economy and demand either softening or shrinking. Most also cut their full year estimates, suggesting they don’t see improvement in the near-term.
In short, while the European crisis is impacting the U.S. economy, the fact is that the Obama policies of excessive regulations, centralized government control of health care, massive debt, and bailouts of preferred industries are not good for the American people. Added to the uncertainty due to the President’s lack of leadership on the fiscal cliff coming in the New Year, and the lack of a budget for every year of the President’s term, and we have a perfect storm for an incredibly weak economy.
What can be done? First and foremost, every elected official should back the principles of the Tea Party. We must balance the budget, weaken the Washington bureaucracy, and unleash the power of entrepreneurs and employers through tax reform and regulatory reform. Only through job creation and constitutionally-limited government can we ever hope to reign in our massive deficits and begin paying down our enormous national debt.
Last night’s debate may have been on foreign policy, but the fact is that the American people are rightly most concerned about the nation’s financial future. Today’s poor earnings reports show exactly why.