“There Was Nothing In It”

While political pundits in Washington counted the number of standing ovations and rehashed stale talking points in response to President Barack Obama’s State of the Union address yesterday, one Wall Street trader who actually monitors how politicians’ words affect the markets had a blunt assessment of the speech.

“There was nothing in it.”

Ben Willis of VDM Institutional Brokerage spoke with The Street.com and offered some amazingly candid and insightful thoughts on Obama’s speech, as well as the general impact of political pronouncements on a flagging market.

“Evidently the people on Wall Street are not as joyful as Ms. Pelosi was (Tuesday) jumping up and down sixteen times,” Willis said. “This is not a surprise. The rally yesterday I think was short covering ahead of Obama’s speech when we weren’t sure what was going to be in it. When we finally saw there was nothing in it, we retraced.”

Exactly.

“There was nothing in it,” Willis continued. “Wall Street hates uncertainty. We keep being told by this administration, ‘it’s coming, we’re going to give you the details, we’re going to give you the details.’ And when they don’t come, we demonstrate our disappointment by taking the stocks lower.”

Of course in all fairness, it’s not just Obama’s rhetoric that’s sending Wall Street scurrying, it’s any politician getting in front of a TV camera.

“We’d really rather see them off television right now,” Willis said. “One minute before they turn the cameras on in Washington, the market always falls.”

Wow. How’s that for a statement?

Another of Willis’ observations we found particularly noteworthy concerned comments made by Federal Reserve Chairman Ben Bernanke about proposals to nationalize America’s banks.

“I think the real impact of his statement (Tuesday) was that there is no desire to nationalize the banks,” Willis said. “That helped rally the financials yesterday, helped rally the entire market.”

Hmmm … so when government backs up, the markets go up? Makes sense to us.

Willis also didn’t confine his criticism to the current administration, specifically singling out former President George W. Bush’s Treasury Secretary Henry Paulson for criticism.

“I think Wall Street’s view is that Hank Paulson’s idea was the wrong way to go,” he said. “It was a knee-jerk reaction following through on what Gordon Brown did in the UK. This is the United States of America, we shouldn’t have (ever) handled it this way.”

Damn straight, dude.

Here’s the clip, and yes, that stuff on his forehead was from Ash Wednesday …

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