Saturday, April 16, 2005
Today, the NYT's editors thought it appropriate to report that the stock market had reached its lowest levels "since the presidential election." Precisely what bearing that date has on the performance of financial markets in April is beyond me. The Times, however, obviously thinks there is a relationship between November 2 and the stock market that warrants elevation to a front page headline.
In any case, the story is accompanied by this graph:
Curiously, the graph makes precisely the point I offered in my post of January 1, which is that the New York Times understated the "Bush rally" in its article of that date. The rally that began at the nadir of the graph (October 26) was actually very impressive.
Curiously, the Times seems to have ignored its interest in the U.S. dollar, which on only April 2 was -- according to the currency traders on the Times editorial board -- on an inevitable downward "trajectory". Not only is the dollar stronger since April 2 (too short a period to draw the conclusion that the Times was either right or wrong), it is only slightly below its level of November 2 (vs. the Euro) and it closed yesterday at a higher level in Euro terms than on any date since November 4.
So if it is significant that the stock market has retraced its gains since election day, why isn't it important that the dollar has regained its losses in that period? If the dollar rallies above 0.784 Euros in the next couple of days, should we expect a headline that says "Dollar rallies to highest point since election"? I'm not holding my breath.
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