Jeff Saut: Don't Rally Around Fannie, Freddie
Potential bailout no cause to be bullish.
Editor's Note: The following article was written by Raymond James Chief Investment Strategist Jeff Saut. It has been reproduced with permission for the benefit of the Minyanville community.
Greetings from Washington, DC, where I am speaking at the Raymond James Financial Services National Conference, so these will likely be the last strategy comments of the week.
I love the Beltway, having lived and worked here for many years, though it's more of a "process-and-power" town than a "product-and-money" town. The most recent illustration of this was when a mere 2 Congresspersons shut down debate on the much needed energy bill, adjourned Congress, and literally had to turn off the lights to force the rest of their colleagues to leave the Capitol building.
Given the mess in which we currently find ourselves, such shenanigans sadly remind me of my elementary school days. That's why I'm penning this morning's missive.
In the movie The American President, Andrew Shepherd (played by Michael Douglas)
"We've got serious problems, and we need serious people. And if you want to talk about character, you'd better come at me with more than a burning flag and a membership card. If you want to talk about character and American values, fine. Tell me where and when, and I'll show up. This is a time for serious people, Bob, and your 15 minutes are up. My name is Andrew Shepherd, and I am the president."
Plainly, ladies and gentlemen, serious times require serious people!
Is oil the next bubble?
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Secondly, it should be noted that I am apolitical. In fact, my industry makes sure I stay that way. But being in Washington, D.C., concurrent with the start of the Democratic Convention, and approaching the elections, I couldn't help reflecting on the candidates' pandering to a largely uninformed electorate while avoiding the really hard issues that need addressing.
Again, bear in mind that I am indeed apolitical; none of these comments are sponsored by my firm. Also know that my bumper sticker reads, "Re-Elect No One." And with these thoughts in mind, I urge you to consider the following, from syndicated columnist
"Politicians are the only people in the world who create problems and then campaign against them. Have you ever wondered why, if both the Democrats and the Republicans are against deficits, we have deficits? Have you ever wondered why, if all the politicians are against inflation and high taxes, we have inflation and high taxes?
"You and I don't propose a federal budget. The president does. You and I don't have the Constitutional authority to vote on appropriations. The House of Representatives does. You and I don't write the tax code. Congress does. You and I don't set fiscal policy. Congress does. You and I don't control monetary policy. The Federal Reserve Bank does.
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