More Washington headwinds
We get no relief from the roadblocks this administration throws up.
By Jim Cramer, TheStreet
Another day starts with no compromise in Washington at the helm, with the press secretary saying the president isn't backing away from the absurd Volcker Rule -- the rule that punishes the diversity that allowed Goldman (GS) and JPMorgan (JPM) to survive but would have done nothing to stop the collapse of Washington Mutual, Wachovia, Fannie (FNM) and Freddie (FRE) as well as AIG (AIG), Lehman and Bear. And, of course, the faux walk across the aisle for health care where there is no compromise of substance that anyone expects.
Why do we care? Same old reasons: Suppose you are a bank. Do you hire and expand or do you hunker down? You do the latter. Do you lend, which is what Sheila Bair bashed the banks for not doing yesterday? Yes, you lend if someone wants to borrow, but who wants to borrow if they can't figure out the health care budget for their potential employees? Have any of these people debating these issues ever started a business? I just helped start my fifth, and the big hole in the budget is what we are going to have to pay people for health care. My reaction? Don't hire until we know. And I am not assuaged by a potential tax credit. Who cares about a tax credit? We may not even make money!
Throughout the country small businesses are paralyzed like this. I know it firsthand. Throughout the country banks are paralyzed. All anyone wishes is that Washington would create a more positive environment for jobs. That's why I have been harping endlessly about natural gas. It has the ability to create jobs quickly. Coal doesn't. Oil doesn't. Solar doesn't. And nuke does, but not QUICKLY, which is what is needed.
That's what Aubrey McClendon, CEO of Chesapeake (CHK), the largest nat gas player, keeps telling us. He's good for it and ready to hire if he knew there would be an embrace of new markets here. But that takes Washington's nudging, and I think that's downright unlikely.
At the time of publication, Cramer was long Goldman Sachs and JPMorgan.
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