“You Retire Once… I Help People Retire Everyday”
The U.S. election is officially in the books and in a historic comeback, Donald Trump has officially been declared as the Presidential Elect. The polls said it was going to be close but, instead, it was a complete red wave.
Leading up to the election and for the last 10 months, I have fielded no shortage of questions on the event. Conversations about various political scenarios can be engaging but predicting market performance based on these scenarios often boils down to just pure speculation. There are also plenty of debates about the extent to which politics actually influence market performance.
In my opinion, the person most likely to influence returns in the near term may not be a single presidential candidate but rather the U.S. Federal Reserve (Fed) Chair Jerome Powell. The trajectory and extent of interest-rate adjustments by the Fed, along with their expected impact on the U.S. economy and inflation, are likely to have more of an effect on investment returns than the person who occupies the Oval Office. It would be wise to advise investors on sticking to focusing on investment fundamentals rather than speculating about potential outcomes.
Below, I have included an attachment put together by our friends and valued partners at Manulife. Their U.S. Election Chart pack includes 12 slides that outline the historical impact of presidential elections on U.S. stocks, broken down into various categories including the political party in power, control of Congress, and election cycles, to name a few.
Hope you find it insightful.
