Yesterday morning, the New York Times had an article discussing how Obama may have made a mistake in passing up public financing for his campaign. There are questions whether or not he can maintain the fund-raising momentum he's enjoyed up til now and that Hilary supporters are not getting behind him the way his campaign expected. He is now probably going to have to spend valuable time doing fund-raising rather than spending it campaigning like his opponent is doing.
To make matters worse, he made a statement about putting "lipstick on a pig", which many have assumed he meant to be referring to Palin's comments about "the only difference between a hockey mom and a pit bull is lipstick". While I don't think Obama intended this comparison, judging by the reaction of this crowd, many of his supporters thought he was.
Even if the comparison wasn't intended, it was a bit of a gaffe to use that expression after Palin's speech.
Glen Reynolds has a round-up of other reactions. Jim Lindgren has more thoughts.
In all fairness to Senator Obama, McCain has used the expression too.