BULLY PULPIT Arbitrage!
Yglesisas notes that fast-food stocks took a beating today after Obama came out in favor of higher minimum wage indexed to inflation. Doesn’t this present a substantial opportunity for those who understand that the United States doesn’t have a parliamentary system? I wouldn’t say that Obama’s position-taking means absolutely nothing, but the odds of Democrats re-taking the House in 2014 are so low that it seems crazy for there to be a non-trivial discount in stock prices for fast-food stocks. (The reaction of the market does make clear, however, why enacting this salutary policy will be enormously difficult.)