stock_creeper's  Instablog

Politicians making promises they can't keep is nothing new, but some promises like more jobs or lower gas prices seem more believable than, say, Middle East peace, so it's easier for voters to be mislead. But even modest promises are still unrealistic because these underlying macro trends (like higher energy prices or weak labor market) are autonomous and immutable to politics.

Romney promises 500k jobs a month. Obama says he'll lower student loan rates. Fat chance. The student loan bubble refuses to pop not because of lack of political will, but because we're in a global macroeconomic 'inflation on' mode. Since 2002 we've seen massive gains in various inelastic goods, including tuition. This is due to speculation, a deluge of global liquidity, and inelastic demand arbitrage. If stocks are going up, if the global economy keeps booming, and if interest rates remain low forever we can rest assured that gas and tuition will keep going up. If S&P 500 companies are compelled to beat the street they will streamline their labor force though cost analysis models to get the maximum output per employee without hurting revenue. If Romney had been elected in 2008 we would still be complaining about the same stuff we are today, even with all his supposed 'business experience'. The labor and housing market would still continue to suck. We would still have intractable pain at the pump. Healthcare and education costs would still be astronomical. The wealth gap would keep widening.

Politicians can't fix problems, but they can create the illusion of making progress. Obama claims to have saved millions of jobs, but what is a job saved? How can we measure a saved job? I don't know. No one does because the only way to prove a job would have been saved would be to create a second reality in a parallel universe without an auto bailout or a stimulus and after four years compare the number of jobs in this splinter universe with our existing universe. It is incredulous for Obama to try to take credit for something that isn't falsifiable, but based only on wishful thinking.

To be fair Romney is full of crap to blame Obama for high gas prices http://www.nationwide.com/rss/gas-prices-fluctuation.jsp

What matters most to Wall St. is accommodative fed policy, political expedience and prudence to quash any possible crisis, and free trade. Europe, on the other hand, has less effective politicians and weaker exports.