The stock indexes are off to a terrible start this morning. Why? Well I've gathered the data and come to this irrefutable conclusion: It's because the New York Giants are favored to win again this weekend. Here are the facts. Since football season started, the Giants are 3-0, and the Nasdaq is off more than 10 percent. Now, with New York slated to battle the 1-2 Washington Redskins, the markets are coming to grips with the idea of the Giants in the Super Bowl, and they are falling to pieces at the thought.
What's that you say? Maybe the markets' woes have more to do with a weak euro, high oil prices, and slowed earnings growth? Maybe today's opening bell dive is somehow related to Intel announcing that it would not make its numbers after the close yesterday? Well, OK, maybe you're right. But my Giants theory isn't any sillier than another one that's making the rounds, which attributes stock index shakiness to Al Gore's poll numbers.
One version of this theory was floated yesterday on the Wall Street Journal's op-ed page, where James K. Glassman, in a piece titled "The Gore Market," dismissed the effects of the euro, oil, and earnings in favor of a "more serious worry for investors: the growing possibility that Al Gore will be elected president and bring a Democratic Congress with him." Glassman is one of those commentators who figures that the best condition for government to be in is a state of gridlocked impotence, which keeps the demon "regulation" in check. Glassman backs up his claims with a chart showing that the stock market has risen fastest during periods of "divided government." (He also notes that it was a Democrat, Dan Rostenkowski, who ran the Ways and Means committee when tax cuts that Glassman sees as key to stock market growth were passed during the Reagan years. That doesn't sound like a very good example of "gridlock," but never mind.)
There's not much point in getting worked up about everything on the Journal's op-ed page, of course, but then a Moneybox reader drew my attention to another piece, "The Gore Correction," written by Larry Kudlow, on the National Review's Web site. Kudlow doesn't hide behind any notions of gridlock. He flatly blames falling share prices on the fact that "[t]he investor class is beginning to focus on Gore's anti-business presidential theme." As an example, he points to a Washington Post story saying that Gore's aides have been using the phrase "the people versus the plutocrats." "The morning after the publication of that story," Kudlow says gravely, "the Dow Jones dipped 200 points on opening."
Now, it's not surprising that the stock market should be an issue in this presidential election. And it's not unreasonable to have a conversation about how the candidates' economic ideas might affect "the investor class." But let's be serious. Al Gore did not cause Intel to miss its numbers. And the reason that theories blaming the markets' bad September (a month that, for what it's worth, has historically been a bad one for the markets) to Gore's poll numbers are so sketchy is that there is precisely no evidence to support them. In fact they are less like theories than they are like simple partisan cheerleading. And that's why the most appropriate response to them is: Go Redskins!
Illustration by Robert Neubecker.