Barack Obama's Lucky Breaks

Barack Obama is a lucky man. Even as the economy idles in neutral and his ratings sink, good things keep happening to him.

Lucky Dollar. Europe's debt crisis is getting worse--a Belgian bank was just nationalized, which means more liabilities for Belgian taxpayers. The dollar remains attractive and capital is flowing into high quality dollar denominated assets. Interest rates remain low but the strengthened dollar prevents a flood of capital out of the U.S.

Bad Guys Can't Hide. U.S. counterinsurgency forces have successfully dealt with bin Laden and Awlaki. Although this is mostly the result of patient, painstaking intelligence work, there's an element of luck in these successes and Obama has been very lucky in the war against terrorism.

Occupy Wall Street. This largely spontaneous protest movement provides the Democrats with an opportunity to organize a counterweight to the Tea Party. In his typically cautious style, Obama waited three weeks before speaking favorably of the Occupiers. The protests give him an opportunity. He's lost most of the popular groundswell that got him elected in 2008, and Occupy Wall Street let's him recover some of his losses. Not all Occupiers like Obama. But not all Tea Partiers like the Republicans and that didn't prevent the Republicans from co-opting the Tea Party movement.

Stock Market Loves Big Government. Ignore what Wall Street says and watch what it does. Today, the Dow Jones Industrial Average rallied some 330 points on vague promises by France and Germany to do something or other to support their banks. Also heartening for stocks was Belgium's nationalization of a sovereign debt-laden bank, Dexia and, Belgium's, France's and Luxembourg's guarantees of some 90 billion Euros of Dexia's future borrowings (which presumably would be used to pay existing creditors off). In other words, losses that would have fallen on financial market participants will now fall on European taxpayers. If you're a banker, you gotta love that. Since Obama's principal policy options at this point are one variant of big government or another, he's lucky to have a stock market that will cheer his every policy success.