The case for not freaking out by election results
Results of an election
by Jon Stewart
Don’t buy into certainty on immediate election results.
Take any pundits’ certainty about election lessons with a grain of salt.
Here’s what we know: we don’t really know anything. People are going to come out of an election and they’re going to make all kinds of pronouncements about what this country is, and what this world is, and the truth is we’re not really going to know shit. And we’re going to make it seem like this is the finality of our civilization and this or that.
We’re all going to have to wake up tomorrow morning and work like hell to move the world to the place that we’d prefer it to be. Just as a matter of perspective, the lessons that our pundits take away from these results, that they will pronounce with certainty, will be wrong.
For evidence, look back on the punditry following several elections, starting with Barack Obama in 2008.
“I think we are moving to a post-racial America,” said George Stephanopoulos at the time. Yeah… that lasted a day.
In 2012, the lesson was, according to Bill O’Reilly at Fox News, that “the GOP needs to send a powerful signal to Hispanic voters that the party respects them”. And signal to the Hispanic community the GOP did. Trump said in 2016 that Mexico sends “drugs, crime and their rapists” to the US.
And what did that teach Democrats in 2016? Multiple pundits said Democrats were bound to find their next leader from “a new generation”. And… Joe Biden accepted the Democratic nomination in 2020.
That led to an insurrection. And pundits in 2021 said that Trump would leave the White House a “pariah”.
This isn’t the end. And we have to regroup and we have to continue to fight and continue to work day in and day out to create the better society for our children, for this world, for this country that we know is possible. It’s possible.
The case for not freaking out by election results
Elections can feel enormously important, but the stock market doesn’t really care.
It’s hard to stay calm on the precipice of a major presidential election.
But if it helps, when it comes to the stock market, history shows that politics are more of a blip on the radar than a seismic shift, at least in the long run.
The big picture: The stock market consistently goes up through different administrations, despite the fact that various policies obviously affect different sectors’ growth.
“Starting Nov. 1 of each election year through Oct. 31 four years later [since 1928], the average index price return is a cumulative 34%,” wrote Associate Director of Equity Strategies for Morningstar Research Andrew Daniels.
And since 1928, the S&P 500 is up an average of 0.7% the week of the election, with the market going a more bullish direction 63% of the time.
Recently, the record has been a bit more mixed.
“Of the six elections since 2000, the S&P 500 was up in three cases by the end of November, and down in the other three,” explained Deutsche Bank macro strategist Henry Allen in a recent note.
So what does matter, if not politics?
Federal Reserve central banking policy, corporate earnings, and the state of the macro landscape matter way more than which party is in charge of the White House in terms of the stock market’s growth.
“Regardless of who wins, the sun will still rise tomorrow, and life, commerce, markets, etc… will continue on whether we like it or not,” wrote Chief Investment Officer at Bleakley Financial Group Peter Boockvar bluntly in a note.
For those not happy with the result, they are at least one day closer to the next election cycle.