We’re about a month away from the presidential elections. Each day the stock market seems to find a new low as we watch the fallout from the deregulation of the financial markets. In turn, telecom/tech is taking a licking. For now, it keeps on ticking.

No newsflash here – many people in our industry tend toward the conservative. I wonder, though, has the tipping point come? Is the competitive community tired enough of eight years of Michael Powell and Kevin Martin wantonly un-writing the ’96 Telecom Act that it will take a chance on Obama?

I think so. I talked with several people this week at the COMPTEL show in Orlando who said they can’t take the Republicans' anti-competition policies anymore. They see little hope of improvement under a McCain administration. Even Mississippi Republican Chip Pickering denounced his party’s treatment of telecom, and he wasn’t soft about it (read even more here). I think there comes a time when the threat of losing one’s livelihood – a whole sector, even – outweighs the fear of voting differently than ever before.

So I ask you, What Will COMPTEL Members Do? Vote party line and risk the paycheck, or take a chance on someone dedicated to competitive policies?

To echo my colleague Tara Seals, there’s just really no good economic news to discuss. Two (more) reasons I say that ... Standard & Poor’s today released an article on the rise in corporate defaults, and PriceWaterhouseCoopers (PWC) earlier this week published a report on the absence of any venture capital-backed IPOs in the second quarter.

First, the S&P data. The article doesn’t pin any specific industry to the wall but notes there were nine U.S. defaults in September, bringing the year-to-date total to 61. Yes, the nine include Lehman Brothers, Washington Mutual and their subsidiaries. But what’s really disturbing is this little gem: “This easily exceeds the combined 16 and 22 defaults in full-years 2007 and 2006, respectively.”

Presumably none of these defaults happened in telecom/tech – we would have heard about them were that the case. But that doesn’t mean the credit crunch isn’t hitting us where it hurts. I know I’ve pointed this out several times in the past couple of days, but AT&T Inc. is having a very hard time selling its short-term debt (read Tara’s excellent blog on this). That scares me because if AT&T is facing this difficulty, what happens to smaller industry companies like PAETEC, XO, Vonage and on and on?

Now for the PWC study. The venture-capital backed IPO market is at a 30-year low. Thirty years. The second quarter of 2008 marked the first time since 1978 there’ve been zero, nada, zilch VC-backed IPOs in a given quarter, PWC said. That means VCs will own companies longer and there will be fewer IPOs over the next few years, the firm found.

Still, those IPOs should be larger than ever. PWC said that’s because complying with regulatory requirements such as Sarbanes-Oxley is expensive. On top of that, “VCs will likely face more pressure to grow IPO candidates big enough to succeed in a more rigorous and expensive IPO process.” That could be good or not-so-good, it seems to me. Good because who wouldn’t want a gargantuan IPO à la Google’s? Bad because it seems there has to be a point of no return or of diminishing returns ... once we cross a certain threshold, is it possible to exceed it? I’m thinking unrealistic hopes and expectations, particularly if this dismal market doesn’t bounce back any time soon. I’m no economist (a terrible profession for someone who had to take college algebra twice), so I hope I’m making sense here. Any economists out there, feel free to chime in.

Anyway. Like the rest of you, surely, I’m way off-balance from watching the stock market zip all over the place these past few days. Wish we could say it’s going to get better by next week ... but that would be unrealistic.

The Wall Street bailout failed in the House today. Every single telecom, cable, equipment-maker stock I checked in the moments after (and before, but after was more telling) was down.

Whatever your opinion on the proposed bill, there is no Plan B to keep the market from melting any further. The closest I could pin down to a Plan B was House Speaker Nancy Pelosi’s comment just now, “What happened today cannot stand. We must move forward.”

It doesn’t look like the communications sector can insulate itself. Google’s shares – a leading indicator among tech stocks – fell below $400, the first time in two years that’s happened. MarketWatch analyzed the media vertical and, similar to my quick research, had no good news to report.

The ripple effects of the credit crunch and subsequent bailout failure are spreading wide and deep.

How is your company planning to weather the storm? How much is it really affected? Send a comment through the function below, or e-mail me at kteal@vpico.com as I am pursuing an article on this and need as much in-the-trenches insight as possible.