I posted the following messages on the Web Saturday and Sunday, to get these things said before the healthcare reform vote Sunday night.
Saturday, March 20: I feel the need to say this on the record, both as an ethicist and an observer of the national scene, before there is a decisive vote on health care. I predict that a prevailing no vote will cause a crisis in the stock market. No one will want to risk their money for the simple reason that no one will know what is going to happen next. They will only know that nothing has happened. Investment will slow dramatically while investors try to sort out whom to trust.
Sunday afternoon, March 21: Here's the second half [of the prediction]: If the Democrats prevail, the Republican will wail, even while their supporters line up to be sure that the guaranteed dollars from the government--the most dependable customer in the world--flow to the businesses they control. Just as medicare brought a huge expansion of hospitals and other medical services, so will this reform. It will benefit the poor, just as medicare benefited the elderly; but the people who will get to spend the money first belong to the professional and business sectors. They will get their cut off the top!
I will stop with the prediction. We will see what Monday brings.
In summary: 1) If the Republicans prevail, the market will go down, probably big; if not immediately, then soon. 2) If the Democrats prevail, the market will go up - if not immediately, then soon.
If I am wrong, I am not a false prophet - just another pundit who doesn't know what he is talking about. I never said the prediction came from God.
Monday, March 22, 2010: Now is now. I wasn't wrong. Because the vote could have gone either way, it was impossible for both of my predictions to be accurate, though both might have missed the mark. As it turned out, the second prediction hit the mark square on. The market improved with the passage of the bill. Here is the brief report from Reuters at noon today:
"U.S. stocks advanced on Monday, boosted by gains in the healthcare sector as passage of a bill to overhaul the system eased uncertainty for investors.
"The legislation was passed by the U.S. House of Representatives late on Sunday, and while analysts have raised concerns it will pinch corporate profits, they said much of the negative impact was priced in already.
"Also, hospital and pharmaceutical companies could likely benefit from the bill."
I am not surprised, but neither am I especially pleased. I don't believe that health care should be bought and sold on Wall Street. Insurance is supposed to insure.
My opinion aside, those who opposed reform must be pleasantly surprised today. The very companies who opposed reform and financed the crusade against it will be among the first to cash in on its passage.
Are we sure they didn't guess this outcome in advance? After all, I did--and this is their business, not mine. So what was all their wailing about last night? Maybe it wasn't wailing. They were singing on the way to the bank.