The Flinchum File
Thoughtful Economic Analysis and Existential Opinions

Get It Over With !

11/03/2016

It’s not nice to fool Mother Nature . . . nor the stock market, which hates uncertainty.

I’ve written that the stock market has believed that Clinton would win the election since late Springtime.  In fact, I predicted a 500-point drop in the Dow the next day, if Trump pulled-off an unexpected win.  During that time (except for the Brexit Bear in late June), the market has just bumped along . . . until recently.

With the latest DOJ surprise and the narrowing polls, the stock market is questioning the belief that Clinton will win, which explains the 7-straight days of small losses.  Confidence is seeping out of the market.  You can see the sharp downturn in this chart of the gray line.

Chart of the Day

The 500-point drop in the Dow may already be happening.  
If you want to fret, you’ll remember this presidential election has been wildly unpredictable and so is the stock market.  If you want to celebrate, look at how the market has historically ended during election years . . . UP sharply!

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