Obama a Socialist? POTUS Talks Tough But Actions Are "Market Friendly," Dow Says

Mark Dow, portfolio manager at Pharo Management LLC, a global hedge fund, says these accusations are baseless. "It's totally false -- it's a construct," he says. The government has demonstrated they do want to get out of the economy."

Most notably, in early 2009 there was a lot of talk about the government nationalizing the banking system, an idea supported by mainstream economists like Nobel Prize-winner Joseph Stiglitz.

But Treasury Secretary Tim Geithner and Fed chairman Ben Bernanke understood that direct Congressional control of banks would be disastrous and vehemently downplayed such speculation, Dow recalls. "That to me speaks to what they believe philosophically the role of markets in the overall economy."

Geithner and Director of Obama's National Economic Council Larry Summers "believe that the private sector is the engine and capital markets are central to growth," Dow continues.

He points to the General Motors and Wall Street bailouts as evidence of the government's ability to step in and help corporations when necessary...but then allow them to (mostly) operate themselves. People who claimed that once the government muddled in these companies it would never leave have been proven wrong, Dow says.

Talk Is Cheap

The abrasive language that Obama and administration officials often use when discussing business is misleading and contrasts with their actions, says Dow. When the economy is failing, Main Street blames Wall Street and Wall Street blames the government. The public, whose support is necessary to pass legislation, wants to see the President be tough on big business. In reality, Dow says Obama's policies have been kind to the private sector. His tough talk is mainly a political strategy.

"If you look at the difference between actions and words, you'll see that the actions have been much more market friendly and much more supportive of the private sector," Dow says. "And the words have often been used tactically to gain support for their agenda."

For another perspective, see: Obama Policies Make It "Impossible" to be Optimistic About the Future, Says Charles Ortel 

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