More Signs Washington Has Too Much Power

Conn Carroll / February 24, 2009

Politico reports today:

It was a perfectly reasonable question, and on the surface it seemed like a perfectly reasonable answer. But when Senate Banking Committee Chairman Chris Dodd went on Bloomberg TV Friday and mused about the possibility of bank nationalization, panicked investors sent the Dow plummeting a hundred points in the next hour.

Whoops.

Dodd’s casual remark and the not-so-casual consequences it caused were among the most vivid examples of a new Washington phenomenon. The city’s sudden status as the de facto world financial capital means that briefings and interviews that once would have passed with a yawn can create instant terror on Wall Street and Main Street alike.
…
Treasury Secretary Timothy Geithner laid an egg earlier this month when his public rollout of a bank-rescue plan was deemed too vague by the markets, and the Dow Jones Industrial Average slid a harrowing 382 points.

Last summer, Sen. Charles Schumer (D-N.Y.) faced criticism that his high-profile criticism of IndyMac’s precarious financial condition caused a run on that bank, which failed days later.

Another garrulous politician, Vice President Joe Biden, did not help the cause of consumer confidence when he told lawmakers, in a remark that got out, that there was probably a 30 percent chance the Obama administration would fail.