…Politics. In the past, we had no idea whether the Stock Market would go up or down or sideways, but that’s all changed because of what I call “big politics”. It’s kind of like big business, but in the world of Government. The whole idea of supply & demand, company valuations and just value in general are now completely out the window. Why? Because the current President of the United States, Barack Obama and his administration, figured out one simple fact: The President takes the blame for how the Stock Market performs, good or bad. Kind of like the Quarterback on a football team who takes all the credit for a Win and all the blame for a Loss. It is for this reason alone, you can expect to see the Stock Market go higher in 2014 and 2015. Check this out…
In March of 2009, a freshly-elected Barack Obama, one of the best “Politicians” in American history, was dealing with a huge economic mess. One thing he learned very early on as President is just how much flack he would take if the Stock Market were performing poorly. It makes a whole lot of sense when you think about it… The public is pissed because their retirement account is getting crushed and Wall Street, where a LOT of the election money comes from, was equally ticked off at the rapidly declining valuation of the pieces of paper they hold so dear. I mean, it’s tough to get new clients in a down market! Everyone on Wall Street knows that! Just look at the chart below which covers the start of 2008 to 12/31/13. Note the Obama Administration realized this important fact in March of 2009. We have been very vertical since that date.
Loose monetary policy from the Federal Reserve has certainly aided in this cause, but I believe the Stock Market would go higher in 2014 and 2015 without artificially low interest rates from the Fed for this simple reason… It’s one less thing to worry about for Big Politics! Sure, they won’t win the country over if the stock market is doing well, but they will surely get less complaints…they will surely mention it in their re-election campaigns how well the stock market is doing and how good everyone’s 401k statement looks. They’ll take credit for it all! The point is, when the Government is using it’s resources to influence the market in a particular direction, that’s the direction you want to be invested. Period. That direction is going to be HIGHER for at least the next couple years.
If you want to talk with someone about investing in the Stock Market, call my Financial Planner Dan Osgood at 1.888.710.4911 or visit www.FreeInvestmentAudit.com.
I’m looking forward to making another killing in 2014! Will you be there with me?
Categories: Stock Market 2014