Investors have spoken. They are looking forward to at least two years of gridlock in Washington. The stock market rallied strongly following election day (even before the Pfizer/COVID news). While it’s always dangerous to attribute stock market movements to any one thing, I believe that investors like the prospect of a divided government.
I think we know what we are going to get with a divided government, which is to say there will be no major changes. Why is that good? It gives companies two years to plan with relative certainty. They haven’t had that in a while.
I’m optimistic that both parties can agree to any no-brainer improvements that need to be done over the next two years. It would be great if they could find some middle ground to work together on things, but I don’t think that’s likely. I’ll settle for nothing too disruptive. The market seems to agree.
p.s. Yes, it seems likely that Georgia’s senate seats are going to a run-off. My best guess is at least one of them goes to a Republican.
About the Author: John O’Connor
John has more than ten years experience as an Investment Advisor. He focuses on devising and maintaining portfolios that meet individuals’ needs, investment research, and investment strategy. John has been recognized as a “FIVE STAR wealth manager” by Twin Cities Business Magazine 2016-2020.Legal Disclaimer: These posts do not constitute an offer or recommendation to buy or sell any securities or instruments or to participate in any particular investment or trading strategy. They are for informational purposes only. CTW gathers its data from sources it considers reliable. However, CTW makes no express or implied warranties regarding the accuracy of this information or any opinions expressed by the author and may update or change them without prior notification.