I think the answer is simple, and a function of how market economies operate. I think the efficiency of a market economy is maximized when it is free of external influences. Therefore, the market will react:
1. Good - Any outcome that results in gridlock within the political arena.
2. Poor - Any outcome that results in a single political party dominant.
Government policy is an external influence, so if one party controls both the legislative and executive branches of government (republican or democrat), it provides the opportunity to create policy, which eventually becomes an external influence on the market. This creates an inefficient market, which rewards some sectors of the economy while punishing others. The party in control determines who benefits and who suffers usually by determining who has most generously lined their pockets in the past.
Good old fashioned gridlock is exactly what would be best for our economy as well as the stock market. Gridlock results in absolutely NOTHING being accomplished, which is exactly what a market economy needs to operate most efficiently. The past 6 years have been marked by turmoil, finger pointing, allegations, and countless other events that have made a lot of noise. But when you look past the smoke, it is pretty clear that nothing politically important has really been accomplished. The market has shown its appreciation by rewarding investors with the most incredible bull run ever.
I cast my vote for PERPETUAL GRIDLOCK, since the market, corporations, small businesses, and average Americans all seem to benefit when given an opportunity to operate under the conditions that currently exist.
Regards, JB |
