Finally, the time has come for Georgia to decide the Senate. Two run off Georgia state elections are underway. And the outcome will likely further divide a fractured nation.
Why does this matter and why should I care?
Well, for starters, politicians can cause huge problems and sink an economy. For example, increased taxes can plunge an economy into recession and turn a bull market into a bear. Also, political “agendas” can be pursued at the expense of sound policies.
Bottom line is investors hate uncertainty. And will vote with their money.
With this in mind, if the US Senate ends up falling to the Democrats investor’s will reassess everything. Investor’s fear Joe Biden and his Democrats minions will enact the most progressive agenda in generations.
However, is the Senate remains in Republican hands the status quo will prevail. Clearly, investors enjoyed the previous balance of power.
On a side note, Tim Kennedy claims Democrats spend a third on defense compared to Republicans. That is to say we should expect terrorism to rise over the next four years. Remember how ISIS started taking over everything during Obama’s term!
Take a look at the S&P 500 stock index over Trumps four year term. Clearly its been a bumpy ride, but the trend is to the upside.
Conclusion
In the end, politics usually get in the way of a good thing. As an investor, you must deal with political risk. By the same token, if a politician wants to get re-elected a booming economy is a “sure thing”. But, self-serving politicians sometimes cause more harm than good.
Of course the stock market is the ultimate voting machine. After all, a rising stock market indicates your political leaders are doing a good job.
Time will tell ….
Look, don’t take my word for it. Check out the latest from the main stream media if you choose. But be careful not to jump to any conclusions. Paid media have their own agenda.
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