By CHARLES GASPARINO
Barack Obama has re mained cool and confident amid the financial melt down, even as John McCain at times has been embarrassing, lurching from one proposal to the next. But while the polls are reflecting Obama's steady hand, the markets haven't. In fact, they're getting worse by the day as Obama's lead widens.
Most investors know the devil is in the details - and the details of Obama's economic plans are anything but reassuring.
Of course, the market turmoil is first a reflection of grim reality - the bursting of the housing bubble and the billions upon billions in writedowns and losses that have forced upon the hugely leveraged financial firms companies that had cranked big profits during the bubble years.
The resulting credit crunch is hitting Main Street harder than ever before. The country is headed for recession; the only question is: Just how low can the markets and economy go?
It could be a lot lower - it all depends on the policies of the next president.
And, as it looks increasingly likely that Obama will be that man, the markets are casting a vote of "no confidence."
To be fair, McCain hardly instills confidence among the Wall Streeters I speak to. Why has his campaign spent the last week focusing on Obama's friendship with former terrorist William Ayers - when it should be hitting Obama's blind loyalty to policies that bring together the worst elements of Herbert Hoover and Jimmy Carter?
Recently, Obama said he wants to expedite loans to small businesses, so he seems to have a clue that they produce much of the country's job growth. Yet his income-tax hike on upper brackets will hit vast numbers of small businesses - they'd face the highest rates they've seen in decades.
Overall, his plan includes some of the most lethal tax increases imaginable, including a jump in the capital-gains rate. He'd expand government spending massively, with everything from new public-works projects to increases in foreign aid to a surge in Afghanistan - plus hand out a token $500 welfare check that he calls a tax cut to everyone else.
This is clearly the wrong way to go in the wake of an economic meltdown - yet Obama, for all his talk of how willing he is to compromise, of how he'd bring people together, is sticking to his tax guns.
I know at least one top Wall Street executive, an Obama supporter from the start of his campaign, who has recently urged Obama to rethink his tax plan - and that was before last week's record losses on the Dow.
But if Obama is rethinking, he's not saying. As his running mate, Joe Biden tells us that it's patriotic to pay higher taxes, Obama remains committed to squeezing businesses even if the recession grows.
The closest evidence I could find of compromise from Obama on taxes came in a June interview with CNBC, when he said: "Some of those [tax hikes] you could possibly defer. But I think the basic principle of restoring fairness to our economy and encouraging bottom-up economic growth is important."
It's easy to understand why so many of my colleagues in the media have fallen head over heels for Obama. He's smart, ambitious and cool under pressure. But what is he really like under the surface?
Some reckon that a President Obama won't go through with his plans. They look at his (thin) record and see a wimp who's never taken a firm stand on much of anything, much less enacting tax hikes during the worst economic crisis since the Great Depression.
I look at Obama's record differently. From his days as a community activist, to his years in the Illinois Senate and now his brief time in the US Senate, he has shown little inclination to deviate from his party's tax-and-spend orthodoxy.
And if he governs like a liberal ideologue - with a belief that the government that works best is the one that's biggest and raises taxes the most - he won't even have to work hard to get his way. House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid won't stop him - the Democratic majorities in Congress are only likely to grow.
And the markets know this - even if pundits (even many of the financial ones) refuse to face it.
No one can blame the faltering stock market solely on Obama's tax plans or McCain's own inanity on economic issues. But stock prices reflect current market conditions plus best guesses of what's coming down the road. And I keep hearing nervous traders and investors talk about "a lack of leadership from Washington."
Charles Gasparino is on-air editor at CNBC and author of the forthcoming book "The Sellout" about the current financial crisis.
AN OBAMA PANIC? - New York Post