Power And Dollar

Obamacare and Copenhagen Accord: Non-Events

US dollar continues its rise against Euro and British pound.  The recent news regarding the development of health care bill and Copenhagen accord did very little to reverse this movement.  Why does it matter?  What does it mean?

The appreciation of US dollar indicates the development of the Obamacare does at best not weaken the confidence of the US economy or even improve the fiscal deficit in the future years and at worst not prevent US from being the temporary safe haven being the money parking lot.  Similarly, since Copenhagen accord is not a binding document, it provides no teeth to decrease carbon emission.  Thus, the mod of economic activity will not run into the risk of major shuffling in the United States.

Certainly a series of quarterly earnings following Copenhagen accord in the United States helps.  However, Obamacare and Copenhagen accord could have set how the future game rules will be structured not only in the States but also in the world, only that the States may have to bear the biggest brunt of this episode. 

In particular, Obamacare is not sending health insurance companies’ stock price downward.  On the contrary, health insurance companies have been performing very well in light of the Great Depression.   Either the market has already factored in all the political risk premium or the market actually considers them as non-events thus far.

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December 22, 2009 - Posted by | advocacy, america politics, health care reform, opinion, politics, US politics, wordpress-political-blogs

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