Sarah Palin: Wall Street's Candidate

by: Jason Schwarz September 04, 2008 | about stocks: SPY / USO / UUP    

Jason Schwarz

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Everyone's talking about Sarah Palin. Thank goodness for investors, she is pro Wall Street. Her Wednesday night RNC speech struck a cord with businesses across the country. This self proclaimed 'gal from Alaska' is already shaking things up with the substance that she offered up on important economic issues.

1) Oil (USO) is heading lower, much lower.  As Governor she began a forty billion dollar natural gas pipeline to help lead America to energy independence. She said,

"Families cannot throw away more and more of their paychecks on gas and heating oil... When a hurricane strikes in the Gulf of Mexico, this country should not be so dependent on imported oil that we are forced to draw from our Strategic Petroleum Reserve...we Americans need to produce more of our own oil and gas. And take it from a gal who knows the North Slope of Alaska: we've got lots of both. Starting in January, in a McCain-Palin administration, we're going to lay more pipelines... build more nuclear plants... create jobs with clean coal... and move forward on solar, wind, geothermal, and other alternative sources. We need American energy resources, brought to you by American ingenuity, and produced by American workers."

Investors are finally catching on to the fact that alternatives to oil are coming and that America is serious about our oil independence. Since oil reached its high in the 140s, we at www.lonepeakportfolios.com have forecast a return to historical levels of $30-$50 a barrel. Political pressure from both Republicans and Democrats might push oil to those levels sooner rather than later. I wonder what the oil guru over at Goldman Sachs is thinking now? He made a very irresponsible call for oil to return to $150 this year and $200 next year after it was clear that a downtrend had begun. I hope that investors in the 53 new commodity ETFs are listening to the 'real' oil data loud and clear; new oil is plentiful and alternatives are rapidly coming on line.

2) Governor Palin will cut spending and she likes eBay (EBAY). If her track record of managing the Alaskan budget is a good indicator, the US dollar (UUP) should be in for a nice ride if this Republican ticket is elected. A balanced budget will restore confidence in the greenback, especially as a slowdown spreads throughout Europe and emerging markets. Governor Palin said,

"That luxury jet was over the top. I put it on eBay. I also drive myself to work. And I thought we could muddle through without the governor's personal chef - although I've got to admit that sometimes my kids sure miss her. I came to office promising to control spending - by request if possible and by veto if necessary. Our state budget is under control. We have a surplus. And I have protected the taxpayers by vetoing wasteful spending: nearly half a billion dollars in vetoes."

3) One theory on the market's negative bias since Labor Day is that fear of an Obama victory will put further burdens on consumers and on the economy. Governor Palin expressed her commitment to lower taxes as she made it clear:

"The Democratic nominee for president supports plans to raise income taxes... raise payroll taxes... raise investment income taxes... raise the death tax... raise business taxes... and increase the tax burden on the American people by hundreds of billions of dollars."

Investors are hoping that the renewed energy brought to the Republican ticket by Sarah Palin might reap tax benefits for Wall Street.

At first glance it would appear that America has lucked out with this candidate who vows to clean up Washington with her fellow maverick, John McCain. She came out of nowhere and has made quite a splash on the national scene. Even the seasoned public speaker Rudy Guliani was left in awe at her natural ability to connect with viewers and relay her specific message. No matter how the media tries to spin it, investors are excited about Sarah Palin. Perhaps her ambition for lower oil, a strong US dollar and lower taxes will lift the plague of pessimism that has hovered over this market for too long. God bless America.

Disclosure: Short USO, Long UUP.

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This article has 116 comments:

  •  
    Sep 04 07:51 AM
    Wall Street's Candidate ;-) If this snippet ever gets out, it will probably damn her vice presidential chances ! Nothing wrong with it in principle, but it would almost behoove the O'Bama campaign to use it as negative sound bite.
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  •  
    Sep 04 07:53 AM
    Spoken like a true Republican. This is not neutral, Jason, and it is not meaningful or relevant to the markets.
    Reply | Link to Comment
  •  
    Sep 04 08:00 AM
    The reason that Alaska has to go to such heroics to get the pipeline done is because Palin passed a windfall profits tax and now when oil is $100 , $75 goes to taxes. What company would invest in a pipeline when the profits from it will go to the state.

    By the way, did you know that she is the most popular governor in because she took the money from the windfall profits tax (and the money from the "bridge to nowhere" which wasn't returned to the Federal Government") and was distributed to the residents of Alaska. Every man, woman and child got a check for $1,200.

    So, when you go to the gas pump and pay a fortune for gas remember that some of that price is going to Alaskan residents in a direct transfer payment.

    By the way, the pols of Venezuala, Iran and Russia are popular as well and for the same reason...they take money from Americans and give it to their citizens.
    Reply | Link to Comment
  •  
    Sep 04 08:14 AM
    Oil going to $30? What world are you living in? I think you need to crack open a basic economics book and start studying the fundamental rules of supply and demand. Take a look at China and India.
    Reply | Link to Comment
  •  
    Sep 04 08:24 AM
    Not a politcal forum here, (but Obama bin Biden is toast from what I've seen so far.) And yes, I've been shorting oil too since mid July. Don't know about $30 (hoping for it though), but certianly appears to be heading below $100.
    Reply | Link to Comment
  •  
    Sep 04 08:34 AM
    Oh please. Smart investors gave up on Wall Street long ago. Whoever wins will be the Greater Depression president or the hyper-inflation president.
    Reply | Link to Comment
  •  
    Sep 04 08:36 AM
    The choice for America could not be more clear! This isn't a video game folks. Reject the party of "real reform" at your peril, and risk of your personal wealth and safety...........
    Reply | Link to Comment
  •  
    Sep 04 08:36 AM
    She was holed up for 5 days with the best of the Republican speechwriters. Wall Street has to wake up to the fact that she will be our biggest nightmare because once in power - she will be unpredictable (especially if she is truly a Believer and true to her faith first) and Wall Street really wants someone who will tow that party line. Wake up. There's a Bacon's Rebellion out there waiting to happen and deservedly so.
    Reply | Link to Comment
  •  
    Sep 04 08:40 AM
    Sarah Palin's Career Ends in Tragedy:

    www.lewrockwell.com/ro...
    Reply | Link to Comment
  •  
    Sep 04 08:40 AM
    Being an independant all my life, I've understood why business has always gravitated to the Republicans. However this year, how can the Republicans run on their miserable eight year economic record touting the same old tax cut and lessez-fare policies.

    Their uncontrolled and reckless spending, record monetary inflation and record budget deficits have dangerously compromised the health of our economy and have threatened our national security.

    I'm not particularly fond of the Democrat's economic policies. But the hypocrisy of the Republicans is unbelievable. How in the world can they criticize anyone after running our nation's economy into the ground? How can they criticize anyone after their unregulated policies fostered the fraudulent lending practices that are bring down our financial institutions?

    God help America.

    Reply | Link to Comment
  •  
    Sep 04 08:42 AM
    Read this:

    news.yahoo.com/s/ap/20...

    LMFAO.
    Reply | Link to Comment
  •  
    Sep 04 08:42 AM
    Note: The first 4 years were republican congress. The next four have been democrat controlled.
    Reply | Link to Comment
  •  
    Sep 04 08:45 AM
    Governor Palin has been running a state with one of the smallest populations in the Union and has benefited from a hugh surplus, thanks largely to Big Oil. She doesn't think much of science and the human effect on global warming. Beyond talking about balancing the budget and continuing the Bush tax cuts for the weathly, including her Wall Street cheerleaders, she does not really have any meaningful answers to the enormous economic challenges facing this country. In addition, her lack of any kind of foreign policy experience, other than being commander of the Alaskan National Guard, would keep me up at night if she became President. I certainly would not want her answering the phone at two in the morning.

    Reply | Link to Comment
  •  
    Sep 04 08:46 AM
    Yes- overthrow the Republicans and elect....... John McCain. Thre is a strong/organized effort to blame Obama for stock market weakness. I agree with above poster who states next President will be Depression President, no mattter who is elected.
    Both parties are bought and paid for, the elites laugh as we argue over Tweedle Dee and Tweedle Dum. But it would be nice to have a president who values thought, and can speak a whole sentence. Obama has the potential to give great radio talks during the next Depression, like Roosevelt did.
    Reply | Link to Comment
  •  
    Sep 04 08:47 AM
    Reality Speaks? Hardly. The governor took the excess STATE taxes paid by oil companies (when WORLD oil prices increased the $ amount collected on the fixed % rate base) and returned them to the state tax payers. As she shoud have. Period. She did not take money from me or add a penny to my gas bill.
    Reply | Link to Comment
  •  
    Sep 04 08:52 AM
    I'm not a religious person, but it sounds like Palin will want prayers and god to be allowed back in public school. Would'nt that be terrible.... The public school my daughters went to had a large population of Somali kids. The Somalians were allowed to practice their religous beliefs at school....
    Reply | Link to Comment
  •  
    Sep 04 09:01 AM
    Sarah Palin will offer an energy-savvy contribution to the Republican ticket. Anybody investing for retirement has to vote for McCain/Palin because Obama/Biden will drain our investment accounts with silly taxes and spend the money on politically correct social programs that don't actually do anything useful.

    If you invest, you can't afford to vote as a limosine liberal this November.

    Reply | Link to Comment
  •  
    Sep 04 09:06 AM
    mangolfer says:

    "Note: The first 4 years were republican congress. The next four have been democrat controlled."

    Sorry mangolfer, you got it wrong. The Democratic controlled congress was seated in January of 2007.
    Reply | Link to Comment
  •  
    Sep 04 09:06 AM
    Rev. Wright, Wiliam Ayers, Michelle Obama . . . . .
    Reply | Link to Comment
  •  
    Sep 04 09:08 AM
    Sarah Palin,,, what a gaL! What a speech, what a life!!
    She's got more executive experience and competence than the Dim Presidential Candidate BHO WHO!!

    Way to go Sarah! Expose the hypocriry of the DIMLIB elitist left.

    To all you leftie DIMLIB socialists, Your "boy" has no clothes and no experience to speak of other than running for office.

    Those are the Facts Jack, and to claim otherwise would be merely a Liberal Perversion of the Truth!
    Reply | Link to Comment
  •  
    Sep 04 09:15 AM
    User 224899 says:

    ".....Obama/Biden will drain our investment accounts with silly taxes and spend the money on politically correct social programs that don't actually do anything useful."

    Gee, George Bush and company have done a pretty good job draining my investment accounts. What exactly has he actually done that has been "useful"?
    Reply | Link to Comment
  •  
    Sep 04 09:16 AM
    Yes - the McCain/Palin administration will be great for America and America, of course after their election will re-stabilize and continue its democratic move forward domestically and throughout the world. Both ticket candidates demonstrate common sense - or unfortunately in our world of politically written and espoused inconveniences, uncommon sense. Vote for smaller and less intrusive right sized Federal government. Vote for the proper use of capital - not the tax penalty grab, take and redirect and finally, consider the acquisition of a made in America hockey puck complete with an embossed Pelosi/Reid characterization.
    Reply | Link to Comment
  •  
    Sep 04 09:19 AM
    I thought Wallstreet rewarded the "best qualified," which certainly is not Palin and is certainly an insult to leaders like Sen. Kay Bailey-Hutchinson or even Secretary of State Condi Rice. Also, what CEO would hire a VP after a single meeting....why would the Street trust such a CEO or a company, and then why would the Street trust this ticket, it sounds like reckless investing!
    Reply | Link to Comment
  •  
    Sep 04 09:20 AM
    Ditto User 224829 - I went through a horrible time in the early 70's when money was taken from people who worked, sometimes multiple jobs to make ends meet, to pay for poverty programs that never did any thing for the poor. A lot of bumper stickers could be seen that said "I fight poverty I work" If our economy has been so wretched for the last eight years why do so many people want to be here? Why don't more people pick up and leave? What we have to do is produce more energy here which will create high paying jobs that you don't have to go to eight years of higher education for. And get into debt because of the high price of tuition in the process.
    Reply | Link to Comment
  •  
    Sep 04 09:22 AM
    It would seem logical to look at the Democratic Party's website to see what taxes they hope to increase and what taxes they hope to reduce. An intelligent person would know not to listen to a Republican candidate for accurate information about Democrats want to do. Likewise, the Democrats are not a reliable source of information about the Republican party's plans. I won't bother to correct the inacuracies in her statements because if you believed them without checking for truthfulness, you're too stupid to to reason with. Never take a politician's word for anything,especially about they're opponents.
    Reply | Link to Comment
  •  
    Sep 04 09:23 AM
    It would seem logical to look at the Democratic Party's website to see what taxes they hope to increase and what taxes they hope to reduce. An intelligent person would know not to listen to a Republican candidate for accurate information about Democrats want to do. Likewise, the Democrats are not a reliable source of information about the Republican party's plans. I won't bother to correct the inacuracies in her statements because if you believed them without checking for truthfulness, you're too stupid to to reason with. Never take a politician's word for anything,especially about their opponents.
    Reply | Link to Comment
  •  
    Sep 04 09:26 AM
    Who is really running this show?The newly elected president must rely on congress and senate backing, so ... let's review this ... the dem's get elected and use the democratic congress, what kind of record have they produced, not good for sure. The repub's get elected and we have the usual republican - democratic split public debate, and what good has it produced so far? A nice guy who has no qualms spending the USA into the dirt to fight an untenable war(s) and a lipstick nuclear power kisser. I mean really people, you are lost to the political norm, whoever wins, everybody still loses!
    Somebody earlier said the elite just laugh all the way to the bank, and that is not completely accurate, however true it may be. (spoken like a true politician) OK ,so why not just elect Ron Paul and Jesse Ventura?
    Think congress or senate would support these guys? Ron Paul is a true Republican, not the plastic version you are voting for. Jesse is a true governor, tested in battle and he also tells it like it is. Why do American's always end up fighting over such lackluster presidential candidates? Because they are "herded" into political camps and easily put under the Delphi(debate tactic developed by RandCorp in the sixties)spell maybe?
    C'mon America you can do better than this - stop yelling at each other and start researching before you destroy each other. The elite love to see the gladiator small guy's tear each other to pieces! Quit the habit.
    Reply | Link to Comment
  •  
    Sep 04 09:27 AM
    ET, great find! Hilarious if it weren't so tragically ominous.

    Palin: Iraq war 'a task that is from God'... terrifying.

    Me: Palin a "danger to our economy, our democracy, our Constitution, a messenger from the religious right bigots and nutjobs."

    ditto for the old man who has admitted frequently and publicly he doesn't know anything about economics... just what we need.. he can pile the final dirt on the grave that dumbya dug for us, our children, our grandchildren
    Reply | Link to Comment
  •  
    Sep 04 09:37 AM
    1. Why is this here? Was Townhall.com booked?

    2. "Her Wednesday night RNC speech struck a cord with businesses across the country."

    The speech ended at 11pm, and you know this by 7am?

    3. "This self proclaimed 'gal from Alaska' is already shaking things up with the substance that she offered up on important economic issues."

    Looking forward to you actually describing this substance. The quotes you provide are just so much fluff. Substance is in details.

    4. "As Governor she began a forty billion dollar natural gas pipeline to help lead America to energy independence."

    Everyone's aware that this pipeline goes to Alberta, right?

    5. "If her track record of managing the Alaskan budget is a good indicator, the US dollar (UUP) should be in for a nice ride if this Republican ticket is elected."

    Tell me - who COULDN'T manage the Alaska budget? Of its $12+ billion of revenue, more than half comes from oil royalties and production taxes and federal government payments. Add to this the profits from investing past oil tax revenues and the annual oil dividends paid to every Alaskan resident, and the state government is paid for practically entirely by oil profits. Is there any other state with so few tough fiscal choices? Does this really give you confidence in her ability to manage the federal budget? Would not Romney have been a better choice if this was a priority?

    6. "A balanced budget will restore confidence in the greenback..."

    What in the speech led you to believe that Palin has any ability, or inclination, to balance the budget? Did she even say that she would try?

    7. Governor Palin said, "I came to office promising to control spending - by request if possible and by veto if necessary. Our state budget is under control. We have a surplus. And I have protected the taxpayers by vetoing wasteful spending: nearly half a billion dollars in vetoes."

    (A) There are differing opinions about the Alaska budget; a Democratic member of the Alaska House of Representatives wrote in the Washington Post yesterday that the operating budget is growing at 10% per year. And with oil prices rising, is there any surprise that Alaska has a surplus? Is there another state where rising oil prices benefit government revenues?

    (B) Governor Palin operates in a government with a line-item veto, something the President does not have. The absence of the line-item veto makes budget cutting much, much more difficult.

    8. "Governor Palin expressed her commitment to lower taxes as she made it clear: 'The Democratic nominee for president supports plans to raise income taxes... raise payroll taxes... raise investment income taxes... raise the death tax... raise business taxes... and increase the tax burden on the American people by hundreds of billions of dollars.'"

    Do tell, Jason, where in the quoted text does Palin express any commitment to lower taxes? All I read are misrepresentations of Obama's stated tax plans.

    ---

    Now, how about we leave this politics stuff to other sites?
    Reply | Link to Comment
  •  
    Sep 04 09:40 AM
    Alaska oil will prime in 2 million barrels per day the most. That is really a big enough supply increase to feed this world in next 20 years, isn't it?
    Reply | Link to Comment
  •  
    Sep 04 09:47 AM
    Enjoyed the article, but love the comments -- Democrats are obviously running scared. Politics is part of our daily lives -- we can't hide from it (as one commenter would like).
    Reply | Link to Comment
  •  
    Sep 04 09:48 AM
    Keep up the comedy, Schwarz! This column was hilarious!

    (It *was* a joke, right?)
    Reply | Link to Comment
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