Markets reacting to health care hearings
Do the Supreme Court hearings on Obama's health care law have investors worried?
Adriene Hill: As you’ve no doubt heard all morning long, it’s day one of Supreme Court arguments over President Barack Obama’s health care reform law. Twenty-six states are challenging the law, parts of which are already in place.
We want to know if and how the arguments could affect investors so we turned to Julia Coronado as we do every Monday. She’s chief economist for BNP Paribas. Good morning, Julia.
Julia Coronado: Good morning.
Hill: Are investors paying attention to these arguments right now?
Coronado: I have to say, not really. They’re much more focused on Chairman Bernanke’s comments this morning and they liked what they heard there.
Hill: Now we’re expecting the Supreme Court to make a decision on health care reform in June. How could that change investors’ minds?
Coronado: Well I think that the health care law is really more of a medium term issue, in terms of how it affects cost structures for companies and even if we got -- regardless of what the decision is, it’s not likely to eliminate all uncertainty for businesses. If it gets struck down, then the question will be, what will replace it? And again, the real issue is, how will it affect hiring costs and therefore employment as well?
Hill: What sort of thing are businesses, when this decision does come from the Supreme Court, what sort of things are they going to be watching for and thinking about for at their bottom lines?
Coronado: Again, health care has been a rising cost for employers, employers that provide employee health care have seen these costs just skyrocket and that’s something that they don’t like because it doesn’t have to do with what they do, with the widgets they make or the services that they do so it’s a nuisance in many senses and what this does of course is expand the reach of that employer provided system by forcing the employers, even who aren’t involved in providing such benefits to get involved and just making that an ever larger part of business.
Hill: Julia Coronado is chief economist for BNP Paribas. Thanks.
Coronado: It’s a pleasure.