The worst Inauguration Day drop in history. Apparently investors aren’t feeling that HopenChange that’s going to fix all of the world’s problems from the economic crisis to the rising oceans.

Jan. 20 (Bloomberg) — U.S. stocks sank, sending the Dow Jones Industrial Average to its worst Inauguration Day decline, as speculation banks must raise more capital sent financial shares to an almost 14-year low.

State Street Corp., the largest money manager for institutions, tumbled 59 percent after unrealized bond losses almost doubled. Wells Fargo & Co. and Bank of America Corp. slumped more than 23 percent on an analyst’s prediction that they’ll need to take steps to shore up their balance sheets. The Dow’s 4 percent slide was the most on an Inauguration Day in the measure’s 112-year history, according to data compiled by Bloomberg and the Stock Trader’s Almanac.

“All the banks are going to have to recapitalize,” said Greg Woodard, portfolio strategist at Manning & Napier Advisors Inc., which manages $16 billion in Fairport, New York. “That’s not done. That’s in front of them, and we don’t want to try to get in front of that trade.”

The S&P 500 plunged 5.3 percent to 805.22. The S&P 500 Financials Index fell 17 percent to below its lowest closing level since March 1995 as concern European banks need more capital also weighed on the group. The Dow average slid 332.13 points to 7,949.09. Both the Dow and S&P 500 retreated to two- month lows.

And how much has the United States lost so far, with things expected to get worse?

U.S. financial losses from the credit crisis may reach $3.6 trillion, according to New York University Professor Nouriel Roubini, who predicted last year’s economic and stock-market meltdowns.

“If that’s true, it means the U.S. banking system is effectively insolvent because it starts with a capital of $1.4 trillion,” Roubini said at a conference in Dubai today. “This is a systemic banking crisis.”

Of course, it’s not right to pin today’s economic news on the Obama Administration. But one must keep in mind two things: 1) Were McCain being sworn-in today, you can bet your butt that the Dow collapse would be attributed to him; 2) The media will do its best to avoid any bad economic news being attributed to Obama over the next four years. Even after it goes from being Bush’s recession to Obama’s recession, The One will still be covered for by the media. His policies end up making the situation worse? It’ll still be blamed on Bush.