There’s a lively discussion on CNBC this morning. One convincing argument is that an Obama win is priced into the market; a McCain win will cause the market to run to the upside.
Here’s the DJIA for the last year. The arrow in May is about when Obama took the Democratic nomination lead. The arrow in September shows the end of both conventions. There’s a precipitous drop as Obama’s lead starts to widen.
Yes, of course, you can argue anything you like. You guys like to argue! But this fits. Would there have been a “credit crisis” if the markets hadn’t started reacting towards an Obama win? Remember, the “crisis” began as investors started to bet against America.
I tend to believe the market will increase no matter who wins once an outcome is certain. The market hates uncertainty, and things are pretty uncertain out there right now.