Is Romney's Surge in Polls Behind the Stalled Rally?
Mitt Romney is holding on to his post-debate bounce ahead of Tuesday night's second presidential debate, according to a new poll by POLITICO/George Washington University. President Obama is leading the former Massachusetts governor by a very small margin, 49% to 48%.
The poll also shows Romney leading 50% to 48% in the vast majority of battleground states, including Colorado, Florida, Iowa, Wisconsin, Ohio and Michigan.
Business Insider's Deputy Editor Joe Weisenthal joined The Daily Ticker's Aaron Task to discuss what this means for the market. Both the S&P 500 Index (GSPC) and the Dow Jones Industrial Average (DJI) are down roughly 2% in the last month.
Weisenthal says the Street believes that Romney, if elected president, would not re-appoint Fed Chairman Ben Bernanke when his terms expires at the end of 2013. The markets want Bernanke to remain at the Fed because of Bernanke's loose monetary policy, which has helped boost stock prices.
"There is some logic to that because there is this idea that the entire rally has been based on the Federal Reserve," Weisenthal says. "If you were to change the top of the Fed, that would undermine the rally."
But Weisenthal doesn't really buy this notion and says investors and market-watchers are just trying to grab on to any explanation for why the rally has stalled.
As he and Aaron discuss in the attached video, correlation does not necessarily lead to causation.
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