When President George Bush prepared for his final State of the Union address, his speech writers definitely had their hands full, with recession fears, and growing impatience over the Iraqi war looming on American's minds. He put on a good face, and did his best to assure Americans that all was OK, but did the American people buy it?

Bush's second term as America's 43rd president has been a rocky road. The President has dealt with low approval ratings, resulting from growing disapproval over the war in Iraq, and most recently the mortgage crisis and slowing economy. Earlier this week, he tried to reassure the country that things were in good shape, and that the country had good things to look forward to in 2008.

The main thing on the minds of most Americans right now is a possible recession getting ready to hit the country. While the President admitted that "growth is slowing," he pointed out that the benefits from a recently agreed upon stimulus package would go a long way to fight off any looming recession.

The package cleared its first hurdle recently with the House of Representatives passing a $146 billion recovery package. Now it moves on to the Senate where its future is a bit more uncertain.

According to The New York Times, "House Democrats introduced legislation on Monday that would for the first time let homeowners sue Wall Street firms for relief from mortgages that the borrowers never had a realistic chance of repaying."

This might be a little bit hypocritical -- it might even be extremely hypocritical. It's not that I doubt that a lot of innocent people got screwed and ended up with mortgages they couldn't afford. But the fact is that Washington's homeownership fetish is as much of a culprit as anything else. From President Bush's 2002 State of Union speech:

Members, you and I will work together in the months ahead on other issues: productive farm policy -- (applause) -- a cleaner environment -- (applause) -- broader home ownership, especially among minorities

We heard a lot of nice sentiment from President Bush Tuesday night but, alas, it is another case of too little, too late. (Or... is it never too late?) It would be great if the $18 billion in "pork barrel" spending he mentioned is really cut by restricting the ease with which our legislature can attach its pet projects to entirely unrelated bills under the cover of darkness. This is the equivalent of about seven weeks of spending on the Iraq war, at current levels.

It also begs the question as to what the administration was thinking until now, as we spent perhaps $100 to $120 billion during his watch on an abundance of special projects. If we give the President and his team credit for on-the-job-training the first year, even though every candidate makes cutting government spending a part of his platform, the administration should still have done something earlier, especially with Republicans steering this ship! This is very embarrassing -- and shameful!

It makes me think the attitude in Washington was that 'the Democrats got theirs, now we're going to get ours'.

I'm no Texan but I've heard they have an expression for people who puff out their chests to hide the emptiness inside: "Big hat, no cattle." This phrase came to mind in reviewing last night's State of the Union (SOTU) address.

How so? After the 2004 election, President Bush announced that he had earned political capital and now he was going to spend it. In 2005 he invested that capital in a failed effort to reform Social Security with private accounts. At last year's SOTU, Bush proposed 14 initiatives, only one of which was achieved. And yesterday, Bush tried to change the subject at the beginning of his speech by focusing on domestic issues. He deferred discussion of the elephant in the room -- Iraq -- reiterating the surge speech he made a few weeks ago which, according to an NBC/Wall Street Journal poll garnered support from 22% of voters. 65% of Americans view Bush as no longer relevant -- hence "Big hat, no cattle."

I won't dwell on Iraq, except to refer to this post arguing for a way to accelerate a solution. On the plus side, I was pleased that Bush initiated a debate on some key domestic issues -- including energy independence and health care -- but disagree with the solutions he proposed.

Cramer came out on CNBC's STOP TRADING segment discussing the ethanol and alternative energy names that have been running up yesterday and today ahead of Bush's State of the Union tonight.

Cramer said he'd be selling the VeraSun Energy Corp. (NYSE:VSE) and Hoku Scientific Inc. (NASDAQ:HOKU) big run-ups here. In his video this morning I alluded to him saying he'd tell people to sell those immediately tomorrow at the open. Cramer maintains that ethanol stocks might work only if oil is $100 per barrel. He even said ethanol is a colossal joke that everyone is in on, but it's a joke that can be played until 9:31 AM.

With the ratings this low and with so many other candidates having thrown their hats into the ring, it is likely that the coverage may be on how the candidates react rather than the impact the administration has now.

Jon Ogg is a partner in 24/7 Wall St., LLC; he does not own securities in the companies he covers.

Dow Jones & Company Inc.'s (NYSE: DJ) Wall Street Journal (A.K.A, The Towel) occupies a unique spot in the media firmament. As I pointed out earlier in the year, it changed its footprint and now looks to me like a Holiday Inn bath towel. Towel Talk offers a perspective on its news and views.

This morning's Wall Street Journal [subscription required] previewed President Bush's State of the Union (SOTU) speech with the kind of "objective reporting" that makes me want to go back to the dictionary to look up "objective."

While Newsweek reports that Karl Rove is betting his colleagues $5 that President Bush will not raise taxes in his final two years in office, if the Towel is to be believed, Bush is planning to propose a tax increase in his SOTU tomorrow evening.

How so? Currently individuals who receive health insurance through their employers do not pay tax on the value of the health insurance benefit. And those who buy health insurance themselves do not get tax breaks on their premiums.

But under Bush's SOTU proposal, the Towel reports, families receiving health insurance through their employers would be required to count the benefits as income. For a family receiving $12,000 in annual health insurance benefits, this could amount to an effective tax increase of $3,360 for a family with a 28% tax rate.

But the Towel uses a tiny subset of the results of its latest poll not to highlight the President's Nixonian level of unpopularity (33% approve of him and two-thirds of Americans have given up on his presidency), but to show that he is responding to an issue that its poll says people care about. And while it touts the administration's estimates of how much the plan will save some families, the Towel neglects to estimate the magnitude of the tax increase.

If Karl Rove is going to keep from losing a lot of $5 bets, he'll need better control over the Towels' reporting.

Peter Cohan is President of Peter S. Cohan & Associates, a management consulting and venture capital firm, and a Professor of Management at Babson College. He subscribes to the Wall Street Journal but doesn't have any financial interest in Dow Jones securities

President Bush will deliver his 2007 State of the Union (SOTU) address on January 23rd. My analysis of the impact of these speeches suggests that usually SOTUs have minimal market impact. But two such speeches in the last 57 years have been big market movers.

SOTU addresses seem to me like the governmental version of a human appendix. They made sense during our formative years when transportation and communication were slow. But these days -- with the Internet and cable news -- we don't need an SOTU to tell us how things are going. The fact is that each citizen's experience is so different that the state of each citizen's life varies almost daily. And, as I posted last month, Bush's 2006 SOTU was a laundry list of legislative agenda items -- most of which did not pan out.

Just as most SOTUs don't change laws, most SOTUs don't move stocks. That's the conclusion I reached after analyzing the movement of the S&P 500 a day and a week after each of the last 57 SOTUs. I found that the S&P 500 rose an average of 0.01% the day after these SOTUs and 0.26% a week after.

But this average masks some interesting exceptions. George H. W. Bush's 1991 SOTU drove the S&P 500 up 4.39% in the week after the speech during which he announced the wildly successful Desert Storm which was largely won by the end of the week. By contrast, Richard Nixon's first SOTU in 1970 -- where he announced balanced budget and anti-pollution measures -- stripped 5.08% from the S&P 500 within the week.

George W. Bush's SOTUs rank him seventh out of 11 presidents in their stock market impact. His average SOTU has cut 0.13% from the S&P 500 in the day after the speech and 0.11% in the week after.

Let's see how he does this year.

Peter Cohan is President of Peter S. Cohan & Associates, a management consulting and venture capital firm, a Professor of Management at Babson College, and editor of The Cohan Letter.