Today, President Obama returns to Washington, D.C. from Hawaii and a well earned rest after a flurry of legislation was passed in the last two months of the year.
His approval ratingshave increased to 50% as the Bush tax cuts were extended, a new 1 year tax cut was passed, DADT was repealed, START nuclear arms treaty was ratified and a health care bill for 9/11 responders was funded. If the mid-term elections sent a strong message of disapproval, then President Obama has clearly understood what the voters want.
For those keeping score, this shift to the center by President Obama was one of my key factorsfor stronger equity markets and Risk-On trading. While Republicans had been skeptical of getting the Bush tax cuts (along with dividend and cap gains) extended, Obama read the Tea Party leaves of the mid-term elections and decided the middle is where he needed to go with policy. My theory that all politicians are at their core self-preservationists holds true.