Sentimental Journey

Since you are reading these pages, your morning should be pleasant and relaxing. You should be in cash, excepting perhaps a few of your own, long-term holdings that you hide under the pillow for a rainy day. It is ok to have a few of those, But otherwise, you should be culling your new buy list for the next run in the bull market. I am not quite ready to yield to the dystopian future that both sides promise us if the other side wins the election.

One way to enhance your returns is to always challenge every assumption in your arsenal. In a year where everything is topsy turvy, it is not such a bad idea. So I was thinking this morning, what if the financial markets have the election backwards too. Wall Street, being the greedy money-grubbers they are, have contributed mightily to the Biden campaign. Wall Street loves borderless Globalism. Governments can be pesky when it comes to cross border business. The fewer governments (and borders), the better. And as to China? C’mon, man, they aren’t such bad people!

Taken together, what if the market has been rallying in favor of a Biden, rather than a Trump victory. Why not? Nothing else has made sense all year? Maybe the market doesn’t favor the lack of change normally associated with the incumbent.  Better the” devil you know than the devil you don’t” could be completely out the window this election year. Maybe Trump’s late surge in the polls might actually be driving the market down! Who knows in these crazy times? However, for now, and given 200 years of history, let’s stick with our current model. In that model, we have moved from Trump Strongly Favored to Trump Mildly Favored as the Dow Jones Industrial Average parachutes to its 200-day line.