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US political uncertainty

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asked Mar 14, 2016 12:05 PM by
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Hi Jin,

As I watch the run-up to the US election I am wondering what your views are on how the market may react to the possibility of certain candidates winning the election? Should I divert money to other markets until after the election or should this even be a concern?

Just to clarify I am not concerned for my investments as I have a long time horizon until retirement but rather I am wondering about my child's RESP.

Thanks,

Wes

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answered Mar 14, 2016 09:08 PM by
Jin Won Choi gravatar image Administrator

Hi Wes,

This is a tricky question. On the one hand, the markets are definitely afraid of the scenario in which certain people become the president. Note that I'm not referring to one candidate in particular, as I think the markets have concerns about multiple candidates.

That said, I think it would be very hard for one person, even if he/she is the president, to dismantle the foundations that made the U.S. so economically competitive. I personally have faith that the U.S. Congress would keep the president from doing too much damage, even if they can't prevent all damage. However, I could be wrong and it's something I'll think about a lot as the election progresses. Right now, the betting odds are in favour of Clinton winning, and markets are comfortable with that. Note that this is what the market thinks - I'm not necessarily saying I want Clinton to win.

Jin

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