I have argued for decades that the press pays too much attention to daily stock market movement. Their immediate fluctuations are of interest mainly to day traders (ah, remember when that was a popular pastime). Their longer term connection to real national wealth, welfare, and happiness is imprecise, to put it mildly. This is especially so in the volatile and panicky mood of the moment.
Obviously my effort to get the daily market reports pushed to the inside pages is a doomed crusade. But in the short run, I wish that, instead of the DJIA / S&P 500 / NASDAQ etc, we had some comparably precise seeming, attention-getting, publicized* measure of credit availability. From all evidence, that is the real emergency driving real destruction of real companies creating real products and about to eliminate real jobs.
While waiting to see what President Bush (ah, remember him!) might have to say on the topic, anecdotage that is getting my attention:
Three weeks ago, I mentioned that DayJet, the pioneering air-taxi company, was shutting down not (it claimed) because of overt business problems but because of the impossibility of getting short-term finance. At the time, the credit squeeze might have seemed an excuse for the inevitable diceyness of the air travel business.
But just in the last few days, I've heard separately from three friends who run objectively "viable" businesses that they are on the verge of closing permanently, or laying off much of their staff, because they can't get short-term working capital. One said he was on the verge of having to close a manufacturing facility in the Midwest that, as he put it, "realistically will never open again." And this is from a group of friends that is heavy on writers, political people, academics, etc rather than a lot of business owners. I have never heard stories like this before. When I was living in northern California during the tech crash early this decade, the story was about the relatively slow deflation of (mostly) unrealistic plans rather than the widespread destruction of enterprises with a future.
My minor point: mainly because they're so precise and fast-moving, financial-market measures crowd out attention from what we really need to worry about, the imminent destruction of businesses and jobs that "should" survive.
My major point: the United States is near a moment of fundamental political choice. To have the discussion distracted by -- well, it would be nice to be even-handed about this, but the truth is that the distraction has been 99% from the McCain side, with the ongoing crap about the Weathermen in the 1960s -- is suicidal. A few weeks ago Senator McCain "suspended" his campaign because of what now seems a mild early phase of the financial crisis. Maybe he and Barack Obama could agree over the weekend to suspend discussion of any topic other than avoiding real economic devastation for the time being, at a minimum until their debate next week on economics.
Now waiting to hear Bush.
* The LIBOR, the London Interbank Offer Rate, is one well known proxy; my point is that the DJIA gets 100 times the attention but is not 100 times as important right now.