Biden Was Elected. And Stocks Didn’t Crash.
It makes sense -- sort of.
When you assess the incoming economic data and the performance of various financial assets following an election, you should consider whether the result of that election might be influencing the data and/or the price action.
Donald Trump made that argument on too many occasions to count over the course of his presidency, insisting that he deserved credit for anything and everything good that happened from the time he won until his inauguration in January of 2017.
Tr
Interesting turn of events and I remember some comments predicting the fact that the whole Election scenario would likely become a “blooper nonevent ” similar to Y2K which was hyped to likely stop the World from turning … System bullish by default as options for placing money become more and more scarce.. Thanking H….for keeping us on the rails and more exposed to the realities than we might be otherwise..
Happy T -day to all .
Businesses don’t like uncertainty and they discretely said so prior to the election via a few spokes-organizations so as not to be the target of a Trump tweet attack. I would argue that the primary reason for the ‘melt-up’ in the last 2 weeks was the Biden presidency looking more and more certain each day.
that and probably a lot of downside protection being sold as it’s becoming clear that the worst case scenario playing out is now highly unlikely.
These causes are intertwined, of course
Worst case election scenario (chaos) averted: 30%.
Vaccines: 70%.
That’s my sense of it. Look at how indicies, sectors and styles performed 11/3 to 11/9, then from 11/9 on.
The first part was a generalized lift, hedges were unwound but the average institutional portfolio (growth, mega-cap, and tech-heavy) didn’t have to change all that much.
The second part has been a large rotation. During the second part, momentum among the FAANNMGs has been uneven, although new leaders have emerged, and institutions have had to start changing sector and style allocations, if they are nimble enough.
Trump – ehh, the Street got tired of him long ago. Other than cutting taxes in 2017, he hasn’t delivered much of anything new to investors, while cutting the legs out from ordinary people.
Ah Covid, Covid, Covid … we’re turning the corner. You won’t hear any more talk of Covid after the election. He was right about one thing…Covid was turning the corner… straight up. What a buffoon.