Election stress is ramping up … get ready for emotion-based market choices … how Louis Navellier is preparing … gold and Bitcoin are “must haves” today
In the early morning hours after Donald Trump won the presidential election in 2016, Oscar-winning screenwriter Aaron Sorkin (A Few Good Men, The Social Network, Moneyball, the West Wing) penned on open letter to his daughters…
It didn’t age well.
Here’s a snippet:
Sorkin Girls,
Well, the world changed late last night in a way I couldn’t protect us from. That’s a terrible feeling for a father. I won’t sugarcoat it—this is truly horrible.
It’s hardly the first time my candidate didn’t win (in fact it’s the sixth time) but it is the first time that a thoroughly incompetent pig with dangerous ideas, a serious psychiatric disorder, no knowledge of the world and no curiosity to learn has…
The world took no time to react. The Dow futures dropped 700 points overnight. Economists are predicting a deep and prolonged recession.
Not so much.
Following that overnight swoon in the stock market, the S&P ripped higher over the ensuing days.
By the end of the year, it was up nearly 5%. By the end of 2017, it had climbed 25%. And when 2020 wrapped up, the S&P was 76% higher than when Sorkin penned his letter.
And that recession?
Never happened.
Yes, there was the pandemic-related recession, but no one can put that on Trump. As you can see below, prior to the pandemic, year-over-year GDP was humming along between roughly 3% and just over 5%. And following the pandemic, growth roared.
I’m not writing this as an endorsement of Donald Trump…
There’s a different takeaway…
A lot of people lose their mind when their presidential candidate doesn’t win.
This often results in apocalyptic economic forecasts for tomorrow, and horrendous, fear-based investment decisions today.
Eight years before Trump, Wall Street panicked when Barack Obama won the election. Stocks imploded the day after his victory. Here’s quick trip down memory lane:
- “Wall Street Reacts to Obama Win: A 5% Plunge” – Forbes (November 5, 2008)
- “Obama Faces Recession, Market Panic” – Bloomberg (November 5, 2008)
- “Dow Sinks After Obama Election; Concerns Over Economic Policies” – ABC News (November 5, 2008)
- “Investors Fear Obama’s Policies Could Worsen Crisis” – Barron’s (November 7, 2008)
- “Obama’s Economic Challenges Could Lead to Further Financial Chaos” – The Wall Street Journal (November 2008)
Despite these grim headlines, the Dow would climb 148% under Obama and our economy would eventually heal from the Great Financial Crisis.
Today, people are losing their minds all over again
Let’s go to Forbes:
Red, white and…anxious? As the U.S. gears up for the upcoming 2024 presidential election, feelings of stress and uncertainty are on the rise.
A new survey of 2,000 U.S. adults from Forbes Health [finds that] more than 60% of survey respondents stated that their mental health has either been slightly, moderately or significantly negatively impacted by the upcoming election. In fact, 46% reported feelings of anxiety, 37% felt stress and 31% experienced feelings of fear…
The American Psychological Association just ran its own survey, finding that more than 69% of Americans are stressed by the election. This anxiety makes sense when you read many of the related headlines from the mainstream media:
- “I Study Political Violence. I’m Worried About the Election” – New York Times (October 10, 2024)
- “Harris v. Trump poll: Americans trust the count but worry about violence” – USA Today (October 23, 2024)
- “Still tense from Jan. 6 riot, D.C. braces for what this election may bring” – The Washington Post (October 20, 2024)
But it’s not just the potential for social unrest. The doom-and-gloom runs rampant with economic/market predictions as well. I’ve read all sorts of dire forecasts…
Trump’s tariff plan will destroy the U.S. economy… Harris will raise the corporate tax rate, kneecapping American businesses and stock prices… Trump’s rollback of green energy investments and subsidies will hurt U.S. consumers… Harris’ proposals to give what basically amounts to “free money” to first time homeowners, minority entrepreneurs, Americans with student loans, and the elderly who want to age at home will result in either an explosion of taxes or an unbearable fiscal deficit…
We’re snowballing toward a crescendo of fear and volatility in the days surrounding the election
Legendary investor Louis Navellier has been monitoring this in recent week. Here’s his take:
“The enemy within” …
That’s how Donald Trump describes his political opponents in the Democratic Party.
And Kamala Harris has warned her supporters that a second Trump term would be a “huge risk for America.”
Each side doesn’t just see each other as the wrong choice for the country. They see each other as an existential risk to what it means to be an American.
If you think this year’s election will be settled on November 5, I have a bridge to sell you. Instead, I predict we’ll see another hotly contested election – after the votes are cast…
The effects of a contested election won’t just be felt in Washington D.C, but also on Wall Street.
I believe we’ll see the market’s “fear gauge,” the VIX, double or even triple as the stock market whipsaws in the days and weeks following the election.
Now, while this sounds unsettling, for investors who can maintain a cool head, such windows of extraordinary volatility can be gifts.
We might view them as brief moments in time when rational investors can make one- or two-years’ worth of investment gains in just a handful of days, weeks, or months. A bit like the “Super Bowl” of trading opportunities – truncated periods of hyper-returns thanks to the fear-based, irrational decisions of others.
Putting his money where his mouth is, Louis is getting in position in his own accounts
Here’s what he just wrote:
I’m already making moves to prepare myself with millions of dollars of my own money.
If you’re interested in the type of positioning that Louis is doing, mark next Tuesday at 7 PM ET on your calendar. That’s when he’s sitting down with Charles Sizemore, Chief Investment Strategist at our corporate partner, The Freeport Society.
The two will be discussing the risks and opportunities surrounding upcoming election chaos, and how to benefit from it. To reserve your seat for this event, click here.
Here’s Louis:
I’ll be showing folks how to navigate the volatility I see coming and turn it into profits by using my proprietary computer-based investment system.
I’ll even give away a post-election trade for free. It’s designed to pay off no matter who wins the election.
To be clear, Louis isn’t predicting a massive, multi-month selloff that’s going to wreck your portfolio. He writes that if you own fundamentally strong stocks and don’t want to take advantage of this opportunity, then you should plan on holding through whatever volatility occurs:
As long as you don’t panic sell out of your long-term holdings as the market whipsaws, you’ll do just fine.
But two notes…
One, if you’re invested in speculative positions that are greatly influenced by who wins in November, be very careful – you’re gambling. You might as well go to Vegas and put your money on red or black.
Two, if you’d prefer not to merely ride through election volatility, or blindly gamble on it, but instead leverage it – trading it like Louis and the pros do – then join him and Charles next Tuesday.
One quick note before we wrap up…
Regardless of who wins in November, gold and Bitcoin will shine over the next four years.
Though Trump or Harris might be closer to what you want from a policy perspective, neither will be a paragon of fiscal responsibility. As we noted in yesterday’s Digest, billionaire investor Stanley Druckenmiller put it this way:
I will not vote for Kamala Harris, and I will not vote for Donald Trump. Bipartisan fiscal recklessness is on the horizon.
More debt is coming… which means more dollar debasement is coming… which means the reduced purchasing power of your dollars is coming… which means that assets capable of riding atop the swell of debasement will better protect your wealth.
In addition to great stocks with pricing power, Bitcoin and gold are two of your best options here.
Over the last 52 weeks, gold has jumped 38% while Bitcoin has doubled.
Going forward, yes, there will be volatility and periods of underperformance. But over the long haul, we expect the prices of both assets will be markedly higher than where they are today.
And what I can write with virtually 100% certainty is that keeping your money in cash year after year is far riskier to your wealth than putting it into gold and/or Bitcoin.
Coming full circle…
It’s looking like we’re in for an explosion of market volatility surrounding this election, and history shows that many people won’t be able to handle it. Their kneejerk, emotion-based decisions will only ratchet up the market swings.
But that’s our opportunity…
The world will not stop the morning of November 6th, and the market will not go to zero.
Yes, we could see some huge price moves, even in great stocks. But if you know how to play it, those moves will be nothing more than wealth transfers – from the Aaron Sorkin’s of the world, to those of us how know better.
Volatility is coming. Get ready.
Have a good evening,
Jeff Remsburg
