Dashboard Update: A Little Breathing Room for Obama (July 30, 2012)

This week was dominated by coverage of the Romney Olympic Gaffe, his needless dissing of the Brits on their Olympic preparedness (“disconcerting”), from the vantage point of his well-earned Salt Lake City expertise.  What a colossal error!  For once the Democrats had no need to turn on their own machine to highlight the gaffe….Prime Minister Cameron and the notorious British press handled that quite nicely.  And on the home front there was much hand-wringing from dazed Republicans.  My favorite was from leading conservative Obama critic Charles Krauthammer, who said: “What Romney answered in that question was unbelievable, it's beyond human understanding, it's incomprehensible, I'm out of adjectives.”

Once again, though, what tops the news does not necessarily influence the data.  But the Dashboard does show that Obama has rebounded from last week’s tightening with a little bit of breathing room in both the national and swing state polls.

The Obameter.  The Obameter dipped a bit, to a still comfortable +7.4, on a slight decline in the stock market average for the week.  Next week will bring another month of unemployment data, the last before the conventions, as well as a new check on consumer confidence.

Obameter
	Baseline
	1-Jan	23-Jul	30-Jul
Unemployment Rate	8.7	8.2	8.2
Consumer Confidence	65.0	62.0	62.0
Price of Gas (average for week)	3.32	3.49	3.49
Dow-Jones (average for week)	12,076	12,842	12,796
Romney Favorability (average)	38.0	43.1	43.1
"Events"	0	5	5
Unemployment Rate	0.0	5	5
Consumer Confidence	0.0	-3	-3
Price of Gas (average for week)	0.0	-2	-2
Dow-Jones (average for week)	0.0	8	7
Romney Favorability (average)	0.0	-5	-5
"Events"	0.0	5	5
OBAMETER	0.0	7.9	7.4
Obama versus Romney	1.1	0.2	1.3

Election Week in Review (July 27, 2012)

The campaigns re-booted on Monday morning after the weekend hiatus created by the tragedy in Colorado, with Mitt Romney eagerly heading off to Europe for a “foreign policy credentials-burnishing” trip.  While such a trip is "off message" from the one-note “it’s the economy, stupid” approach Romney has taken to date, it is a welcome way (for Mitt) to change the conversation from taxes and Bain Capital.

Clearly Romney chose to use the trip as a conversation changer rather than cram in a Vice Presidential selection.  Our readers thinks Senator Rob Portman of Ohio will ultimately get the prize.  I do, too – unless Romney starts falling behind, in which case he might throw his version of a “long bomb” and take Senator Marco Rubio of Florida instead.

But the trip did not exactly begin the way Romney would have scripted it – then again, that was his own foot in his own mouth.  It didn’t take long for Mr. Salt Lake City Olympics to take the British Olympic organizers to task for “disconcerting” snafus in their security planning.  He was promptly rebuked by the British press and Prime Minister David Cameron.  I had to laugh at the tabloids’ quick nicknames:  the "Party Pooper" (Daily Mail), "Nowhere Man" (Times of London) and "Mitt the Twit" (The Sun).  Ouch.  I was listening to POTUS on satellite radio this afternoon and a very proper British journalist referred to Romney as a “man of awkwardness.”  And Cameron, Mitt’s ideological soul mate, by and large, was clearly miffed at the criticism.  Mitt walked it back and they made nice in their meeting, but this was not a promising beginning for the Mittster.

Romney’s team has been fighting back, quite effectively, making much ado about the “You didn’t build that” flap.  They took a section of an Obama speech and parlayed it into a blistering attack on Obama’s alleged lack of understanding of how entrepreneurship works.  Obama was trying to make the point that anyone who has built a business did not do it alone – they had help from teachers, mentors, friends, our capitalist system and yes, even the government.  It was a good thought but an awful construct.  Here is what Obama said in full: 

“If you were successful, somebody along the line gave you some help. There was a great teacher somewhere in your life. Somebody helped to create this unbelievable American system that we have that allowed you to thrive. Somebody invested in roads and bridges. If you’ve got a business—you didn’t build that. Somebody else made that happen.”

Obama was referring to the “roads and bridges” that helped the entrepreneur succeed, not to the entrepreneur him or herself.  He certainly should have glorified the role of the entrepreneur more fully.  But the “you didn’t build that” snippet has taken on a life of its own through Romney ads and dutiful media coverage, striking a chord among those who indeed believe Obama is anti-business, or doesn’t understand how the economy works, or is a flat-out socialist.  It is surely hurting Obama.

Back to more fact-based stuff, the New York Times put together a terrific chart on the state of campaign fundraising, which I replicate below:

Stuck in the Mud (July 27, 2012)

You may recall a few weeks ago I asked my anonymous friend from Connecticut – clearly a Republican – for a view on the Connecticut Senate race.  He seems to have taken the opportunity to appear on Obameter2012.com to the max!  Here is his rant on the Presidential campaign… plus a few thoughts on Connecticut!  He calls it:

Summer Heat Wave Breaks, Clarity Emerges:  “Stuck in the Mud”

For regular readers of this number-crazed blog, you know the author clearly is a "micro-view" guy - obsessed with various zeitgeist measures.  He avidly tracks and averages these measures, contending this will lead to an accurate prediction of the upcoming Presidential race.

This post is a contrary view from the macro side.  The "micro" stuff doesn't matter:  forget charisma factors,  small-base polls, swing states, disputes over who ran Bain, how Mitt got $100 million in his IRA (my theory:  in LIBOR-based derivatives of Spanish bonds held off-shore in a Barclays account, with a lot of leverage on top + a share of Bain Capital management fees). 

But Tom, I do like to look at the pretty charts!  Lots of action!  Love the analysis!  You're the best!

But go back to 1992 brush up on your James Carville - it's "the economy, stupid."  Moreover, the growth rate trend in the economy is what really matters.  And Obameter2012.com loyal readers (are you out there Chris Matthews and Sarah Boxer of CBS News?), this baby is slowing.  The hopey-changey thing is over, Obama's charisma will only matter to slices of the swing states, where his base is thinning and might stay home in November nursing their disappointment that he didn't go far enough on his quasi-Socialist agenda.

Now that the Summer Heat Wave 4 has broken in Connecticut, economic reality has emerged.  As the Chairman said this week we are “stuck in the mud.”  For avid readers of the Beige Book like me, who stupidly invested in TBT back in 2008 at 44+ (yes, that's the 2x short of the 30-year Treasury) believing there was no way we could see 5 years of 0% interest rates, the following truths are now coolly clear:

• Obama's stimulus did nothing.  2/3 went to prop up states and indirectly, the labor unions. (Beneficiaries of the Citizens United decision, btw).   It's gone - there's nothing to replace the revenue.  Check out Ravitch's report - state budgets are in the crapper.  Problems and fights loom with the state employee unions across the country.
• 10 Year rates hover at 1.5% - a 25% drop from the 2% rate back in January.  There's the final signal - we are becoming Japan - low rates + excessive government spending + looming over-regulation = NO GROWTH.  Oh, JPY 10-year is now at 0.8%.
• More importantly, the low rate, no growth scenario has begun to trigger a giant reverse wealth transfer from the 50+  (how about those unfunded pension liabilities) to the government!  To fund what - a wasteful $550 million bus lane to run between Hartford & New Britain?
• The Supreme Decision (yes, Roberts did the right thing -it's a tax, plain and simple) to allow Obamacare go forward dooms us all to escalating health-care costs - now 20% of the economy - to be funded by:  more government spending!
• The macro view:  this election, like most Presidential re-elections, will depend on the economy.  The election is not about Romney, it's a referendum on Obama and his arrogant strategy that expanding the government's role in the economy is good for the people, and will generate growth.

The truth is emerging:  It's wrong.  It didn't work.  The economy is slowing.  We are “stuck in the mud." Continuing with Obama will send us on our way to a Japan-like lost decade. 

Election Week in Review (July 27, 2012)

The campaigns re-booted on Monday morning after a weekend hiatus created by the tragedy in Colorado, with Mitt Romney eagerly heading off to Europe for a "foreign policy credentials-burnishing" trip abroad.  While such a trip was off message from the one-note "it's the economy, stupid" approach Romney has taken to date, it was a good way to change the conversation from taxes and Bain Capital.

Clearly Romney chose to use the trip as a conversation changer rather than cram in a Vice Presidential selection.  Our readers thinks Senator Rob Portman of Ohio will ultimately get the prize.  I do too – unless Romney starts falling behind, in which case he might throw his version of a "long bomb" and take Senator Marco Rubio of Florida instead.

But the trip did not exactly begin the way Romney would have scripted it – then again, that was his own foot in his own mouth.  It didn't take long for Mr. Salt Lake City Olympics to take the British Olympic organizers to task for "disconcerting" snafus in their security planning.  He was promptly rebuked by the British press and Prime Minister David Cameron.  I had to laugh at the tabloids' quick nicknames:  the "Party Pooper" (Daily Mail), "Nowhere Man" (Times of London) and "Mitt the Twit" (The Sun).  Ouch.  I was listening to POTUS on satellite radio this afternoon and a very proper British journalist referred to Romney as a "man of awkwardness."  And Cameron, Mitt's ideological soul mate, by and large, was clearly miffed at the criticism.  Mitt walked it back and they made nice in their meeting, but this was not a promising beginning for the Mittster.

Romney's team has been fighting back, making much ado about the "You didn't build that" flap.  They took a section of an Obama speech and parlayed it into a blistering attack on Obama's alleged lack of understanding of how entrepreneurship works.  Obama was trying to make the point that anyone who has built a business did not do it alone – they had help from teachers, mentors, friends, our capitalist system and yes, even the government.  It was a good thought but an awful construct.  Here is what Obama said in full: 

"If you were successful, somebody along the line gave you some help. There was a great teacher somewhere in your life. Somebody helped to create this unbelievable American system that we have that allowed you to thrive. Somebody invested in roads and bridges. If you've got a business—you didn't build that. Somebody else made that happen."

Obama was referring to the "roads and bridges" that helped the entrepreneur succeed, not to the entrepreneur him or herself.  He certainly should have glorified the role of the entrepreneur more fully.  But the "you didn't build that" snippet has taken on a life of its own through Romney ads and dutiful media coverage, striking a chord among those who indeed believe Obama is anti-business, or doesn't understand how the economy works, or is a flat-out socialist.  It is surely hurting Obama.

Back to more fact-based stuff, the New York Times put together a terrific chart on the state of campaign fundraising, which I replicate below:

	Raised	Spent	Cash
	To Date	To Date	On Hand
Priorities USA SuperPac	20.7	18.3	2.8
Democratic National Committee	196.3	178.4	37.5
Obama Campaign	273.7	208.2	97.5
Total	490.7	404.9	146.8
Restore Our Future SuperPAC	81.3	60.5	21.5
Republican National Committee	202.1	120.6	89.4
Romney Campaign	154.4	133.4	22.5
Total	437.8	314.5	191.2

This chart is not quite exhaustive – there are other SuperPacs out there, largely backing Romney.  But the basic picture is that Obama has raised more, and spent more to date, but Romney has more cash on hand.  Essentially, Obama spending is "front-loaded" in an effort to "define" Romney – particularly in swing states – before he can define himself.

Dashboard Surprise... (July 24, 2012)

The weekend's political news was overwhelmed by the tragedy in Colorado, which, apart from everything else, demonstrates how campaigns are at times beholden to exogenous events.  All campaigning essentially shut down for three days.  Both candidates were immediately confronted with appropriate responses to the tragedy as well as the gun control issue, an issue neither candidate has wanted to engage.  As of now, neither has strayed from the position that current gun control laws are adequate.

The data for the week, largely collected before the tragedy, was surprising.  A CBS/New York Times poll was quite the outlier, particularly on favorability scores for each candidate.  The result was that there is finally some red ink (that is, Romney ahead) on the Dashboard, on the "Charisma Factor," of all measures.  And the polls tightened both nationally as well as in several swing states.

The Obameter.  The Obameter rose a bit, to +7.9, on the strength of the stock market and a dip in Romney's favorability rating (more on that below).

Obameter
	Baseline
	1-Jan	25-Jun	2-Jul	9-Jul	16-Jul	23-Jul
Unemployment Rate	8.7	8.2	8.2	8.2	8.2	8.2
Consumer Confidence	65.0	64.9	62.0	62.0	62.0	62.0
Price of Gas (average for week)	3.32	3.49	3.41	3.47	3.43	3.49
Dow-Jones (average for week)	12,076	12,724	12,625	12,886	12,669	12,842
Romney Favorability (average)	38.0	42.7	42.8	45.7	45.3	43.1
"Events"	0	0	5	5	5	5
Unemployment Rate	0.0	5.0	5.0	5.0	5.0	5.0
Consumer Confidence	0.0	-0.1	-3.0	-3.0	-3.0	-3.0
Price of Gas (average for week)	0.0	-1.7	-0.9	-1.5	-1.1	-1.7
Dow-Jones (average for week)	0.0	6.5	5.5	8.1	5.9	7.7
Romney Favorability (average)	0.0	-4.7	-4.8	-7.7	-7.3	-5.1
"Events"	0.0	0.0	5.0	5.0	5.0	5.0
OBAMETER	0.0	5.0	6.8	5.9	4.5	7.9
Obama versus Romney	1.1	2.1	3.2	0.5	2.1	1.0