NEW YORK (TheStreet) -- This year's State of the Union Address is likely to be different in tone and substance from last year's address. At that time, the President's tone was forceful as he voiced strident attacks on the business community and the substance of his anti-business agenda included financial services reform, climate change legislation, the termination of various oil tax breaks, carried interest, and federal subsidies to banks making student loans. His address was delivered in the midst of an 8% pullback in the stock market, as measured by the S&P 500.
Since the mid-term elections, the President has taken numerous steps toward the political center and is now embracing business interests. The President has taken business friendly actions in recent months such as signing into law the Bush tax cuts which included pro-business provisions such as 100% expensing for businesses to write-off equipment purchases. He also signed off on a free trade agreement with South Korea and pledged last week to sponsor an effort to cut regulatory red tape to help businesses. The President has also reconstituted his advisors, bringing business leaders into key positions. Last week he appointed Jeffrey Immelt, GE's chairman and chief executive officer, as chairman of his outside panel of economic advisers. He recently named William M. Daley, a former JPMorgan Chase executive, as his chief of staff. President Obama's approval ratings have reversed course and moved above 50% (according to Gallup) since he began his shift toward the center. He is focused on winning over moderates (Independents voted Republican by 56-37 margin in the mid-term elections). We believe this year's centrist and pro-business State of the Union address is likely to be both stock- and bond-market friendly. During this week's State of the Union address, we will be listening for three key areas of emphasis that have the potential to be market moving: job creation, social security reform, and corporate tax cuts. Job Creation Of course, politics can drive economic outcomes, but the economy also affects political outcomes. The economy will likely be the key driver of the 2012 election and the most important measure will be job growth. As you can see in Chart 1, inflation-adjusted, after-tax income growth of about 3% appears to be the threshold for incumbents to get 50% of the popular vote. Currently, this measure of per capita income is only growing at 1.4%. Clearly, factors other than jobs have a bearing on the election. However, job creation may be the key measure by which his presidency will be judged when he is up for re-election in 2012. The President is likely to address measures to stimulate job growth in his address. These may include exceptions to an overall discretionary spending freeze such as spending increases for maritime, road, and telecommunications infrastructure and for job-training programs. With General Electric's CEO heading the President's new Council on Jobs and Competitiveness, intended to come up with ideas designed to get unemployed Americans back to work faster, the programs are likely to be pro-business and, therefore, stock market friendly. Social Security Reform While the deficit is the number one issue on the minds of voters, there is likely to be more rhetoric than actual spending cuts. The President could highlight some minor cuts to defense discretionary spending as he emphasizes the gains in Afghanistan and Iraq will allow him to continue troop withdrawals. This may result in lower supplemental funding requests, though we do not look for any material cuts in spending. Add Comment Tweet 1 2 Last » Next › var OutbrainPermaLink='http://www.thestreet.com/story/10983523/a-pro-business-state-of-the-union.html'; var OB_Template = "thestreetcom"; var OB_demoMode = false; var OBITm = "1276003897985"; var OB_langJS ='http://widgets.outbrain.com/lang_en.js'; if ( typeof(OB_Script)!='undefined' ) OutbrainStart(); else { var OB_Script = true; var str = ''; document.write(str); } adsonar_placementId=1341527;adsonar_pid=879768;adsonar_ps=-1;adsonar_zw=600;adsonar_zh=280;adsonar_jv='ads.adsonar.com'; TheStreet Premium Services Compare All Services Jim Cramer's Action Alerts PLUS: Now any level of investor can trade right alongside a Wall Street pro — and enjoy 24/7 access to his portfolio! Learn More Login ETF Profits: Get money-making ideas from the hottest investment vehicle on the planet. Our experts show you how to play various ETF sectors to help pump-up your portfolio. Learn More Login OptionsProfits: Get 50+ trade ideas a week from the industry's top options experts. Plus — exclusive commentary on market trends and essential trading tools. Learn More Login RealMoney Silver: Get Doug Kass's exclusive trading diary + 5 of TheStreet's top premium services including Action Alerts PLUS and RealMoney — all on one streamlined page. Learn More Login Stocks Under $10: Break into the market with small- and mid-cap stocks... all $10 or less! David Peltier tells you exactly which low-priced stocks he's buying and selling. Learn More Login RealMoney Breakout Stocks Portfolio PLUS Daily Swing Trade Market Movers TheStreet Ratings Top Stocks To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details. var disqus_identifier = '10983523'; (function() { var dsq = document.createElement('script'); dsq.type = 'text/javascript'; dsq.async = true; dsq.src = 'http://thestreet.disqus.com/embed.js'; (document.getElementsByTagName('head')[0] || document.getElementsByTagName('body')[0]).appendChild(dsq); })(); comments powered by Disqus. blog comments powered by Disqus //* Global Functions *// function metadataRegisterNS(ns){ var nsParts = ns.split("."); var root = window; for(var i=0; i Dow Jones S&P 500 NASDAQ 10-Year Note 11907.45 1281.84 2698.91 33.26 Oil * 95.29 DOWN -73.07 DOWN -9.0 DOWN -18.64 DOWN -0.82 10 Yr 3.33% SPDR Gold 129.79 -0.61% -0.7% -0.69% -2.41% Data delayed 20 minutes More From TheStreet var randnum = Math.floor(Math.random() * 100) if (randnum < 45) { document.write("Ex-Dividend Date Calendar"); document.write("Cramer's Latest Picks from Mad Money"); document.write("Free: Stock Rating Reports"); document.write("Top-Rated Stocks"); document.write("Highest-Yielding Dividend Stocks"); document.write("How to Invest in Gold"); } else { document.write("10 Best Dow Dividend Stocks"); document.write("Top Stocks Under $5"); document.write("JPMorgan's Favorite Stocks"); document.write("Best Energy Stocks for $100-Plus Oil"); document.write("Goldman's Best Stock Picks for 2011"); document.write("Top Warren Buffett Dividend Stocks"); } Twitter Facebook RSS Mobile App adsonar_placementId=1341369;adsonar_pid=879768;adsonar_ps=-1;adsonar_zw=320;adsonar_zh=280;adsonar_jv='ads.adsonar.com'; Brokerage Partners YAHOO.util.Event.on(window,"load",function(){ setTimeout(function(){ TSCM.util.attachScript('scr_intellitxt','http://thestreet.us.intellitxt.com/intellitxt/front.asp?ipid=10685'); },1200); }); try { function DM_onSegsAvailable(segs, cust_id) { for (var i=0;i document.write(unescape("%3Cscript src='" + (document.location.protocol == "https:" ? "https://sb" : "http://b") + ".scorecardresearch.com/beacon.js' %3E%3C/script%3E")); var beaconurl=""; if(TSC.util.isDefined(document)){ beaconurl=document.URL; try{ if (top.location != self.location){ beaconurl=document.referrer; } }catch(e){} } COMSCORE.beacon({ c1:2, c2:"6036014", c3:"", c4:beaconurl, c5:"", c6:"", c15:"" }); (function () { var d = new Image(1, 1); d.onerror = d.onload = function () { d.onerror = d.onload = null; }; d.src = ["//secure-us.imrworldwide.com/cgi-bin/m?ci=us-thestreet&cg=tsc&cc=1&si=", escape(window.location.href), "&rp=", escape(document.referrer), "&ts=compact&rnd=", (new Date()).getTime()].join(''); })(); Free Newsletters from TheStreetAfter the Bell
Before the Bell
Booyah! Newsletter
ETF Daily
Midday Bell
TSC Top Ten Stories Newsletter
Winners & Losers
We respect your privacy. Manage Newsletters Podcasts [Select Podcast] The Real Story Wall Street Confidential Podcast Daily RSS UpdatesTheStreet Mobile Edition
Connect with TheStreet
YAHOO.util.Event.on(window,"load",function() { try { var loginlink = YAHOO.util.Dom.get("logonoff"); var cookie = new UserStatus().streetCookie; if(cookie.indexOf('|')== -1){ loginlink.setAttribute("href",""); loginlink.innerHTML = "Log In"; } } catch(e) {} }); TheStreet Mobile | MainStreet | StockPickr | BankingMyWay | Jim Cramer | Doug Kass | RealMoney | Try Action Alerts PLUS TheStreet Corporate | Home | About Us | Advertise | Customer Service | Employment | Privacy Policy | Sitemap | Topic Archive | Video Archive | Stock Quotes Online | Terms of Use document.write('© 1996-2011 TheStreet.com, Inc. All rights reserved.TheStreet's enterprise databases running Oracle are professionally monitored and managed by Pythian Remote DBA.
Quotes delayed at least 20 minutes for all exchanges. Market Data provided by Interactive Data. Company fundamental data provided by Morningstar. Earnings and ratings provided by Zacks. Mutual fund data provided by Valueline. ETF data provided by Lipper. Terms & Conditions. Powered and implemented by Interactive Data Managed Solutions.
TheStreet Ratings updates stock ratings daily. However, if no rating change occurs, the data on this page does not update. The data does update after 90 days if no rating change occurs within that time period.
IDC calculates the Market Cap for the basic symbol to include common shares only. Year-to-date mutual fund returns are calculated on a monthly basis by Value Line and posted mid-month.
*Oil Data in Market Overview is Brent Crude Pricing
'); TSCM.ads.AdPlacerx.sz = "728x90"; TSCM.ads.AdPlacerx.resetTargets(); TSCM.ads.AdPlacerx.calltype = "adj"; TSCM.ads.AdPlacerx.includeDcopt = true; TSCM.ads.AdPlacerx.additionalTargeting = ";;storytype=investingOpinion;kval=investingOpinion"; TSCM.ads.AdPlacerx.writeTag(); TSCM.ads.AdPlacerx.sz = "233x224"; TSCM.ads.AdPlacerx.resetTargets(); TSCM.ads.AdPlacerx.calltype = "adj"; TSCM.ads.AdPlacerx.adtype = "cau"; TSCM.ads.AdPlacerx.additionalTargeting = ";;storytype=investingOpinion;kval=investingOpinion"; TSCM.ads.AdPlacerx.writeTag(); TSCM.ads.AdPlacerx.sz = "336x280,336x850,300x250,468x648"; TSCM.ads.AdPlacerx.resetTargets(); TSCM.ads.AdPlacerx.calltype = "adj"; TSCM.ads.AdPlacerx.additionalTargeting = ";;storytype=investingOpinion;kval=investingOpinion;;storytype=investingOpinion;kval=investingOpinion"; TSCM.ads.AdPlacerx.writeTag(); /** * function wrapper that places all DART ads using TSCM.ads.positionToPlaceholder * if positionToPlaceholder can't find the elements specified, it just returns and is ready for the next call */ TSCM.ads.placeLazyLoadingAds = function() { // DART 1 (banner) TSCM.ads.positionToPlaceholder({ ad: 'ad728x90', placeholder: 'bannerContainer', flexibleHeight: false }); //DART 2 TSCM.ads.positionToPlaceholder({ ad: 'customUnit', placeholder: 'cauContainer', flexibleHeight: true }); //DART 3 TSCM.ads.positionToPlaceholder({ ad: 'boxAd', placeholder: 'boxAdContainer', flexibleHeight: true }); //DART 4 TSCM.ads.positionToPlaceholder({ ad: 'secondBoxAd', placeholder: 'secondBoxAdContainer', flexibleHeight: false }); }; TSCM.ads.placeLazyLoadingAds() window.setTimeout(function() { TSCM.ads.placeLazyLoadingAds() }, 2000); window.onresize = function() { setTimeout(function() { TSCM.ads.placeLazyLoadingAds(); }, 1000); }; function lazyLoaderVisibility() { YAHOO.util.Dom.setStyle("lazyLoadedObjects", "visibility", "visible"); } YAHOO.util.Event.onDOMReady( lazyLoaderVisibility ); var _gaq = _gaq || []; _gaq.push(['_setAccount', 'UA-6534317-1']); _gaq.push(['_trackPageview']); _gaq.push(['_setCustomVar', 1, // This custom var is set to slot #1. Required parameter. 'gwo2', // The name acts as a kind of category for the user activity. Required parameter. 'gw-' + getcombo_ga2("7-0-0"), // This value of the custom variable. Required parameter. 2 // Sets the scope to session-level. Optional parameter. ]); _gaq.push(['_trackEvent', 'recommended', 'LOADED']); (function() { var ga = document.createElement('script'); ga.type = 'text/javascript'; ga.async = true; ga.src = ('https:' == document.location.protocol ? 'https://ssl' : 'http://www') + '.google-analytics.com/ga.js'; var s = document.getElementsByTagName('script')[0]; s.parentNode.insertBefore(ga, s); })(); /* */ var disqus_shortname = 'thestreet'; (function () { var s = document.createElement('script'); s.async = true; s.src = 'http://disqus.com/forums/thestreet/count.js'; (document.getElementsByTagName('HEAD')[0] || document.getElementsByTagName('BODY')[0]).appendChild(s); }()); BF_BB_DATA = null; (function( ){ document.write(''); var sid="76IOF7"; var c=""; var b=""; BF_BB_SCRIPT=document.createElement('script'); BF_BB_SCRIPT.type="text/javascript"; BF_BB_SRC="http://buzzbox.buzzfeed.com/wd/BuzzBox?sid=" + sid + c + b + '&it=1&cb=' + (new Date()).getTime(); setTimeout(function() { document.getElementById('BF_BUZZBOX').appendChild(BF_BB_SCRIPT); BF_BB_SCRIPT.src=BF_BB_SRC; },1); })();Before the Bell
Booyah! Newsletter
ETF Daily
Midday Bell
TSC Top Ten Stories Newsletter
Winners & Losers
TheStreet Mobile Edition
Connect with TheStreet
Read Full Article »