The day after President Obama’s impassioned speech for big-government health care, Wall Street bet heavily that the so-called government-insurance option he supports is dead.

In a strong stock market on Thursday — the market’s fifth-straight daily rise (so much for the September swoon) — health-insurer shares advanced significantly. Cigna increased 5 percent; Health Net almost 5 percent; Humana 3.5 percent; and UnitedHealth Group 1.5 percent. Hospital shares like Community Health Systems and Tenet Healthcare also rallied smartly, climbing about 5 percent each. Drug company Pfizer rose more than 1 percent.

These stocks would not have rallied if the public option looked alive. Corroborating this, the Intrade pay-to-play online betting parlor shows only a 24 percent probability of the government option passing by the end of this year. Also, of 17,308 respondents in a Politico poll, 38 percent registered thumbs-up for the president’s address while 58 percent said thumbs-down.

Obama’s speech was not a game-changer. Good delivery, bad product.

I predicted Obama would double down. It’s good to see the markets predicting that Obama’s hand will bust.

Read Larry Kudlow.

Tags: Barack Obama, Blackjack, Health Care Reform, Public Option, Speech

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