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David Callaway
Jan. 6, 2011, 9:12 a.m. EST
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Two turtle doves and Nasdaq 3,000
First Take "º
What if we repealed Dodd-Frank?
By David Callaway, MarketWatch
SAN FRANCISCO (MarketWatch) "” One popular theory this week, at least in Democratic circles, is that the political ascension of the teary-eyed John Boehner and the mysterious dropping from the sky of dead birds in the U.S. South and in Sweden are caused by the same force.
The end of days are nigh.
Alas, like most Doomsday theories, it doesn't stand up to the test of the stock market, which continues to rise despite almost overwhelming arguments for another crisis-filled year around the world.
Take your pick: soaring food prices, persistent debt problems in Europe, rising inflation in China, a potential collapse of the U.S. pension system, or municipal turmoil in the majority of states. Each is a good reason for investors to be a lot more bearish than they are right now "” and for stock indexes such as the Dow Jones Industrial Average /quotes/comstock/10w!i:dji/delayed (DJIA 11,684, -39.99, -0.34%) , S&P 500 Index /quotes/comstock/21z!i1:in\x (SPX 1,273, -3.73, -0.29%) and Nasdaq Composite Index /quotes/comstock/10y!i:comp (COMP 2,708, +5.72, +0.21%) not to be at 2 1/2"“year highs.
A scan through the media landscape and the blogosphere reveals no shortage of opinions about how the market has gotten ahead of itself and is destined for a short-term turnaround, if not a full-blown return to the lows of March 2009, depending on how apocalyptic one's view is.
Why stocks ended higher Wednesday, what role the day's economic data played, and why Disney and banks were among the big winners.
Yet most of the reasons to anticipate a downturn in stocks existed well before the December rally or the gains in these early days of 2011. What's new, and very premature, is some evidence that the U.S. economy is finally "” finally "” starting to see some good news on jobs.
Two reports Wednesday added fuel to this fire. One was a monthly report on private-sector jobs. The ADP National Employment Report said the economy added a stunning 297,000 new private positions in November (ahead of the December rally). See MarketWatch story on ADP jobs report.
Another report, from jobs consultant Challenger, Gray & Christmas, showed that job cuts nationally in 2010 fell to their lowest level since 1997, before the tech bubble.
All this has created optimism ahead of Friday's unemployment report from the Bureau of Labor Statistics, which is forecast by a MarketWatch survey of economists to show 143,000 jobs were created in December, up from 39,000 in November.
One or two months of positive numbers do not a big recovery make. But if true, it's a start the economy has been awaiting for a long time, and would help explain the stock market's recent buoyancy.
David Callaway is editor-in-chief of MarketWatch, responsible for the global news coverage of 100 journalists in 12 bureaus in the U.S., Europe and Asia. A financial journalist for more than 20 years, Callaway has worked for Bloomberg News, the Boston Herald, and assorted television and cable stations as a reporter, columnist and commentator.
Repealing Dodd-Frank wouldn't shake up finance. Instead, the Republicans will squeeze regulators through budgets and hearings to keep rule-making friendly to banks.
19 min ago2:29 p.m. Jan. 6, 2011
"What could be a more fitting sight then Charlie Rangel reading the Constitution in the House of Reps to his peers....." 11:57 a.m. EST, Jan. 6, 2011 from dcallaway
"Boehner cries; birds drop, yet stocks still rise: Things can't be that bad as long as stocks are rising. Fo... http://on.mktw.net/fbiOcf" 12:41 a.m. EST, Jan. 6, 2011 from dcallaway
"Commodities in day two of sell-off and gold at six week low.......today a big day for retail commodity investors...." 12:50 p.m. EST, Jan. 5, 2011 from dcallaway
"Two turtle doves and Nasdaq 3,000: Earlier this month marked the 10th anniversary of the last time the Nasd... http://on.mktw.net/gFPBPQ" 12:59 a.m. EST, Dec. 23, 2010 from dcallaway
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