Last week, markets barely moved. The Dow Jones Industrial Average added 7 points or 0.04% while the S&P 500 jumped 8 points or 0.38%. The Nasdaq Composite Index gained 0.83% to close at 5257.40 on the back of big gains at Netflix.
Markets appear to be in a holding pattern until November 8. Having survived all three presidential food fights, they are now pricing in a Clinton victory, a possible slim Democratic majority in the Senate and a slimmer Republican majority in the House. The real question is how much Mrs. Clinton, if she does indeed prevail, will be plagued even before she enters the Oval Office by investigations of her emails, the Clinton Foundation, her conduct as Secretary of State, and her repeated lies to investigators and the American people.
In other words, the odds of her entering office with any kind of mandate are somewhere between slim and none – which means we can look forward to, at best, four more years of gridlock.
Regardless of how hard the Republicans come at her, she will face significant resistance in Congress to her plans to raise taxes, increase entitlement spending and move the country further to the left. The most likely scenario is further gridlock as the country moves closer to another recession and perhaps a financial crisis.
But I do see one tiny reason for market optimism… Continue reading…