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And they are completely right. Nobody knows what the leadership will be in this nation in 15 months, we could have someone who wants to add more regulation to the economy or we could have someone who wants to remove all regulation. Nobody really knows and to invest based on either assumptions is a gamble. The big time traders are smart, they have a wealth of information available to them.
Here is a good example. Our current administration has shown willingness to invest in and subsidize renewable energy. So this provides more incentive to invest in these companies because you know they will have the support of the government. If somebody like Perry gets elected, you know that these industries won have the support of the federal government anymore.
This is the type of stuff they are talking about when they say there are uncertain market conditions. The healthcare law is another good example. Many Republicans are talking about repealing it. While the law is good for people, it can cause some restraints on businesses. I believe it's worth the trade-off, but if you are only interested in corporate profits, you do not want the law around.
Economic uncertainty is when people do not know how the government will impact the private sector. People do not want to hedge their risk by waiting until the 2012 election is over, so they have a better idea of where things are going. I assure you, Democrat or Republican, we will see a lot of growth in the markets after the election because there will be more political stability.
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