The point of mentioning this is that the day-to-day and week-to-week swings are generally driven by emotion and manipulation by the insiders. Trying to make a case that a particular version of the health insurance reform bill is bad or good based on the stock prices is not going to be immediately clear from short-term swings. And you can be sure if it is bad the insiders won't let us the retail investors know until they have all cashed out first. Don't get me wrong, I am not trying to imply that the current health insurance reform bill is not a water-down piece of sellout legislation but there are portions of it that are not favorable to the future profit potential of the health insurance companies. One of them is the provision that health insurance companies must spend 85% of all the money they take in from premiums on health care related expenses. That is an improvement over the current national average of 75% and will eventually affect their bottom line. On the flip side the health insurance companies will be getting new enrollees because of the mandates. That may be a wash to them but in theory we should all get more health care for our dollar.
If one compares these longer term stock charts to science and technology stocks one sees a much different picture. This particular science and technology fund has recovered almost all of the losses that occurred in the stock market crash at the end of the Bush term.
The health insurance stocks have certainly not had the run, so far, like they did under the Bush administration where they had triple digit appreciations in stock prices. They still are down about 50% from where they peaked, whereas many other stocks have nearly recovered all their losses after the Bush administration's mishandling of the economy at the end of his term. Time will tell whether this current legislation is a baby step in the right direction.