Inauguration Dow Drop ... Obama and the Economy?

Somewhat lost among all the excitement and pomp of yesterday was the fact that bank stocks dropped yesterday in the worst Inauguration Day drop in history. Bank stocks like Citigroup and Bank of America are now worth less per share than say, what you’d pay for a tall latte at Starbucks. Bad news: it’s hard to have a financial system without banks. Obama was all smiles but you know this had to be weighing on his mind since the worst part of the drop happened after his speech in the afternoon. Banks were struggling worldwide yesterday. To me, however, I had to wonder how much of the drop was due to international factors and how much might have also been triggered by fear of a black president.

Why do I say that? I don’t know his name but one anchor on CNBC yesterday actually pointed to what he called “class warfare” in Obama’s speech. Everyone knows that Wall Streeters tend to lean conservative. I’d say there’s been plenty of class warfare when you talk about how ordinary Americans have been treated by the Bush administration (um, subprime mortgages? the shaft that credit card holders have received? etc). Obviously we have to keep banks from collapsing as they did during the Great Depression. Yet, pouring money down banks without addressing the root cause of their troubles only perpetuates the distress. People can’t pay their mortgages or their credit card bills. Cuz Americans be broke. We need to fix the system to help average Americans with housing and jobs — we need to spend billions not just on banks but on homeowners.

Obama has put the economy front and center on his agenda and on his coolio new website www.WhiteHouse.gov. Here’s some info on what Obama is proposing from his new site.