Wednesday, November 08, 2006

The Effect of Elections on the Stock Market

None. It, just like every other story is a one day event. The market will go up or down - it always does. The sky won't fall the seas won't part and we will (probably) not see the second coming before nightfall. The country is going into recession or not - no political party since the beginning of time has been able to figure out how to change the business cycle. There is simply too much money involved.

While the Federal Government commands a great amount of money the impact of the Federal Government on anything other than war and pestilance since the great depression of 1929 has been minimal. That's because there is so much more money in the economy right now that the Federal Government doesn't stand a chance.

So when you hear the bobbleheads all repeating today's soon to be favorite litany about the "market not liking uncertainty" stand up, turn around, point your posterior at the TV and drop trou - because that is the only respect that that analysis deserves.

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