Sometimes an Assurance of Reliability is Disconcerting
President Obama today said investors should have "absolute confidence" in money placed with the United States. Glenn Reynolds posted that item and asked:
UH OH: Obama: Have ‘Absolute Confidence’ in T-Bills. Did previous administrations find it necessary to issue such attention-getting assurances?The answer is yes, with an ugly reaction. In 1893, Grover Cleveland's Treasury Secretary John Carlisle made the following statement attempting to reassure the public about the federal financial stability, Carlisle said "Treasury would meet demands for payment in gold so long as it has gold lawfully available for that purpose." That reassurance (as you may well guess) did nothing to calm the public or the markets as people read extra meaning into the bolded portion. It will be interesting to follow the action in T-Bills on Monday.
And distressed investors continue to wonder if Obama is shorting the market.