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More of a Red Ripple than a Red Wave

November 09, 2022

Here are a few thoughts on the US mid-term election...

  • Democrats did better than expected, narrowly losing the House and possibly keeping a split Senate. 
  • The markets expected a “Red wave” and a more significant shift to a pro-biz agenda. 
  • There will be a halt to additional progressive spending (which has contributed to inflation and made the Fed’s job to rein in inflation harder)
  • New corporate taxes are unlikely. 
  • Gridlock tends to be better for markets. 
  • Regardless of your political leanings, the analogs after mid-term elections are 100% positive over the next 6 months and 12 months (see below). 

Red Wave

Source: Bespoke

As always, we’ll let our indicators guide our strategy exposures, but we still think we can see some further year-end rally up to 4100-4200 S&P 500 (+5-10%), another pullback/correction in 1Q’23 and then a better year in 2023 than 2022.

Vineyard Global Advisors offers a range of investment strategies designed to allow participation in the market's growth within a dynamic, risk-managed framework that seeks to protect against significant market declines. Our goal is to give our clients greater peace of mind by generating steadier returns over time. Contact us to learn more. 

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