Guess what? You’ll never guess. Because this is such a shocker, it is. So I’ll go on and tell you. The bond markets aren’t happy with our new Democratic overlords! Read:
Political risk is becoming more of a U.S. issue as some investors howl over what they see as arbitrary intrusion by the government in business affairs.
They view President Obama’s restructuring plan for bankrupt automaker Chrysler as an attempt to subvert the legal rights of lenders and say lenders will also be unfairly targeted if the U.S. Congress passes a bill to rewrite bankruptcy law to reduce home mortgage payments.
Investors concerned that politics could hurt them may demand a risk premium before they buy stocks or bonds or do a business deal. That could make the U.S. less competitive and money might flow elsewhere.
“There is a much larger political risk premium on investing in the United States than there has been in years,” said Sean West, an analyst at Eurasia Group, a research and consulting firm that studies political risks.
“What we’re seeing now in the United States is much more like what we see in emerging markets, where the government either by choice or as a result of circumstance is in a position to decide which companies or banks survive and which ones don’t,” he said. “These were almost unthinkable risks a year ago.”
Funny, how under President Bush the US was always descending into fascism — yet it’s under President Obama that the bond markets react as though our government is made up of thugs.
Welcome, again, to the Banana States of America.