Does the stock market want an Obama or Romney presidency?

Does the stock market want an Obama or Romney presidency?

As a Certified Financial Planner™, I have been trained to stay away from two topics; politics and religion. The choice of who you vote for is a personal decision and everyone has the right to express their opinion. This year, there are many important issues to be discussed including healthcare, employment, taxes, interest rates and fiscal challenges. The next President and the next Congress will have to deal with all of these challenging issues.

According to JP Morgan Asset Management, the stock market returns have been highest when we have had a Democratic President and the Republicans controlled the House and the Senate. The second best performance was when the Democrats controlled The Presidency and the House and the Senate. Third best performance came when the Republicans controlled the Presidency but the Democrats controlled the House and Senate. Fourth best performance came when the Republicans controlled the Presidency and the House and the Senate. Fifth place went to when the Republicans controlled The Presidency and the Senate and the Democrats controlled the House.

What can you make of this? First, remember the adage that past performance is not a guarantee of future performance. Second, it would appear that the stock market favors split governments.

Perhaps, just as big an issue for this election is what happens in the House and Senate races. As you know, Congress has one of the lowest approval ratings in US history and there is tremendous gridlock. According to www.voteview.com, over 90% of the members of the House and Senate are voting with the majority of their party. Thus, unless this changes, we may see more gridlock in the future.

No matter what your opinion, don’t forget to vote on November 6th!