Down The Sewer Pipe – Politically Speaking

I have mentioned this before and it seems like a good time to mention it again.  Words matter a lot in the business of politics.  Consider the stock market plunge in the light of the rhetoric coming from both the Congress and the President of the United States of America.

First the government decided to “bail out” the banks; inventors sold stock in those banks because with the government “buying in” the investment in stocks is watered down.  Investors then sold shares to take their earnings before the stock fell.

Then some members of Congress in uniform unison with the president said that some banks might need to be completely government run.  More investors sold their stock because if the government nationalizes the banks the investors loose all of their money.  The stock market fell even further

Then CTI bank decided to shed their pretense of being a public owned bank, inviting the government to have over a thirty percent share in them.  Preferred voting shares converted to non-voting shares.  Investors sold more bank stock driving the stock market down even further.

What this points to is that the drop in the price of sticks, investor confidence, and the ability of businesses to receive credit, is directly affected by the rhetoric of elected officials.  When you are in elected office, or if you are already in office, it will behoove you to be careful with what you say.  The words that come out of your mouth can cause panic and economic hard ship for your community and beyond.  As the above real life examples indicate.

Sherman