It’s Election Day

by Marilou Moursund on November 6, 2018

in equity market,Fed policy,Fiscal Policy,politics

The Wall Street Journal had a good summary today of the various concerns facing the market titled “Why the Election Shouldn’t Distract Investors”.  From the linked article:

Every market pundit has a view on how the election will affect markets. The truth is, the economic and financial forces at work right now are so powerful that the impact should be minimal.

Let’s start with the outcome that most people expect: The Republicans hang onto the Senate, but the Democrats take control of the House. That should be met with relief in the markets. Treasury investors, for example, would worry less about the prospects of a bigger budget deficit with a Republican sweep (more tax cuts) or a Democratic one (infrastructure spending). And if investors view a Democratic sweep, and the intensified political pressure on President Trump that would bring, as the most dangerous outcome, a divided Congress could count as a comfort.

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