Does the Dow get an Obama bounce Wednesday?

[trof]

I think so.

[ksoze]

1. Already built-in

assumed win already priced in.

[rl6214]

5. I would agree here

N/T

[Nye Bevan]

2. No.

The stock market is already discounting an Obama victory as this is seen as a near certainty. Other factors might affect the Dow, like whether the Dems get a filibuster-proof Senate (I suspect that this might cause a down move as this would raise concerns about protectionism).

[slick8790]

6. Right. The market has pretty much already priced in an Obama victory. n/t

[scheming daemons]

7. European and Asian markets have NOT priced it in, though...

They don't trust our electoral process.... so they're sitting on the sidelines until they know FOR SURE that Obama won.


Then they'll flood their markets (and ours!) with buy orders.


Watch.

[scheming daemons]

3. Yes.... here's why

Asian and European markets will have a euphoric day..... and FOREIGN money will be buying U.S. stocks on Wednesday.

[Nye Bevan]

8. Ah, the "wall of money" theory

I remember that one from when the Conservatives were re-elected in the UK in 1987, and it didn't work then either. That election was also pretty much a foregone conclusion; if a bunch of foreign investors want to buy US stocks if Obama is elected, then why not beat the rush buy them now at lower prices, since his election is almost a certainty?

[scheming daemons]

9. Because foreign investors have no faith in our electoral system and are waiting for REAL results

[Nye Bevan]

10. In this case you could do the following:

1. invest $100 in foreign stocks;
2. bet $2 on McCain to win the election (current Intrade odds about 10 to 1).

Then if Obama wins, if your theory is true, foreign stocks should soar by (let's say) 5-10%. So even after the $2 you lost betting on McCain you would come out nicely ahead.

And if McCain wins, as long as stocks fall by less than 20%, you would still come out ahead.

This sounds too good to be true, so it probably is.

[nyc 4 Biden]

4. ABSOLUTLEY!

Obama Win = A Brighter Future for America = More Confidence in Markets

[MindMatter]

11. I don't know about Wednesday, but it will be up 1000

by the time Obama takes office. In a very real respect, Obama takes office on Wednesday. He's still a sitting Senator, of course, and there will be no more Bush legislation passed, no more signing statements, no more Bush. Bush will still have the executive orders, which Obama may have to reverse in January.

But the key thing is that Obama will be in a position to help well publicized meetings laying out the policies and agenda for the new administration. It is traditional to do this quietly before Inauguration Day. But it is also traditional for the lame duck to have an approval rating somewhere north of 40%

Considering the crisis state we are in, Obama will want to make his impact felt very quickly and very publicly. I wouldn't be surprised for him to name his Treasury team early and have a series of joint meetings with Paulson, for example. As people see the pieces falling into place, confidence will build, and lift the stock markets with it.

[monmouth]

12. Most definitely and watch the global markets. It will be great...n/t

[crazylikafox]

15. I agree

[enid602]

13. no

I´m not expecting an Obama bounce so much as a lack of Bush bounce.

[Ichingcarpenter]

14. Fox just said a democratic president and congress is good for 401ks

By 2-1 over the years. The moderator didn't like that then he said




The S&P is better with a republican president and democratic house.

[trof]

16. That's true.

Historically the economy, wages, employment have always been better under a Democratic administration.