Political, or concern about corporate accounting (and that certainly can't be ignored), I think its hugely overdone. I also think it's institutional rather than small investors. The problem with a presidential speech about the market (ANY president) is that it establishes a mood, at random, for the next several days or weeks. That's why presidents seldom make speeches about the market.
Bush needed to warn that small minority of Winnicks, Ebbers, Lays, etc. that Clinton is GONE and they aren't going to get away with lying and fraud anymore. That was important. He was also subtly giving the accounting profession the word that they waited too long, and will now be repaired through law and regulation. It's too bad, but they deserve it. The long run effects of the speech (and if a president DOES speak out about the market, the only way to judge it is over at least the following year) will be positive. Partly because Bush, unlike Clinton, has credibility and a reputation for integrity. And partly because the private sector is, and always has been, self-correcting... |
