No surprise to you and me, but apparently this comes as quite a shock to the Huffington Post. Paul Blumenthal reports that Democrats sputter that Wall Street never had it so good, but perhaps the investors in the world of finance might know a bad stock when they see it. Obama has been outraised in the financial sector by Mitt Romney at a ratio of almost 12:1 in the fourth quarter of 2011 — and Romney hasn’t even won the nomination yet:
In the fourth quarter of 2011, Romney raised $1.49 million from employees of those 68 companies while the president’s reelection campaign raised just $127,000 — an 11.7-to-1 ratio. It was the most lucrative quarter for Romney yet.
“Clearly it was a great quarter for Romney, in terms of fundraising from Wall Street and from securities and banking firms, in particular the biggest one,” said Sheila Krumholz, CRP’s executive director. “It is not surprising that he was able to do that. It is just surprising how rapid the shift has been towards him and away from Obama.”
The abandonment of the president by the financial sector has, indeed, been remarkable in scope and speed. Some of the very companies whose employees cut checks for Obama in 2008 now seem fully devoted to funding his competitor in 2012.
- Goldman Sachs employees, who donated more than $1 million to Obama’s first run for the White House, gave Romney more than $106,000 in the fourth quarter of 2011. Obama received just over $12,000 during that same period.
- Bank of America employees, who donated more than $388,000 to Obama in 2008, gave Romney more than $77,000 in the fourth quarter of 2011. Obama received just under $16,000 during that same period.
- CitiGroup employees, who donated about $730,000 to Obama in 2008, gave Romney more than $196,000 during the fourth quarter of 2011. Obama received $3,842 during the same period.
Blumenthal fumes that Obama has been their best friend, in part because he hasn’t gotten around to prosecuting them yet:
Why the world of finance is leaving Obama is a subject of some irritation among Democratic fundraisers. Wall Street executives, after all, have thrived under the Obama administration. The Justice Department has been notoriously slow in pursuing investigations of fraud. Ditto for the Securities Exchange Commission.
No one has thrived under the Obama administration except lobbyists. Investors have to sit on capital rather than put it to work because of the inability to price out risk on anything more than a single-year basis, thanks to the gimmicky economic policies of Obamanomics. Regulations like ObamaCare and Dodd-Frank, with the unlimited rule-making ability of bureaucrats both bills contained, means no one knows where to put their money or how much a job will cost in three years.
It’s no coincidence that the fundraising problem started in the fourth quarter. Just before the start of that quarter, Obama launched his class-warfare campaign in a joint-session speech, inspiring the Occupy movement that terrorized businesses in Oakland but mostly petered out into a national joke as winter approached. Obama all but declared war on the investment community, and they have decided that backing an old-school New Leftist is a very bad investment.
Or maybe it doesn’t even take that much analysis to understand why the financial industry considers Obama a bad risk. After all, the CBO explains it pretty well in their latest economic projections, emphases mine:
In part because of the dampening effect of the higher tax rates and curbs on spending scheduled to occur this year and next, CBO expects that the economy will continue to recover slowly, with real GDP growing by 2.0 percent this year and 1.1 percent next year (as measured by the change from the fourth quarter of the previous calendar year). CBO expects economic activity to quicken after 2013 but to remain below the economy’s potential until 2018.
In CBO’s forecast, the unemployment rate remains above 8 percent both this year and next, a consequence of continued weakness in demand for goods and services. As economic growth picks up after 2013, the unemployment rate will gradually decline to around 7 percent by the end of 2015, before dropping to near 5½ percent by the end of 2017.
Put yourself in the shoes of the investors. If you had bet big on a firm three years ago and ended up with this kind of performance, you’d be looking for a better investment now, too.