By: Greg Hansen, Vice President & Senior Portfolio Manager
Election 2020 has come and gone…well, almost. As of this writing, it looks like there could be some legal battles to come and there are still a couple of run-off elections in Georgia that will dictate which party controls the U.S. Senate. But, as it stands, it doesn’t look like either party won a landslide victory.
With the voting and most of the vote counting now behind us, much of the uncertainty around the outcome is starting to subside. Heading into the election, almost every conversation with our clients involved discussions about what impact a victory by either side would have on portfolios. Far too many people were swayed by their emotions and political beliefs and they saw the outcome as binary—either the Democrats or the Republicans would win. The reality with this election—and frankly with most elections in our history—is something in between.
It appears we are headed for a split government with Democrats controlling the House of Representatives and the Presidency while Republicans (and a couple of moderate Democrats) hold enough seats in the Senate to force some level of cooperation between the parties. Historically, split government has been a strong force for equity markets since neither party can make dramatic changes to the regulatory environment without the approval of the other.
Throughout our conversations, our advice to clients was to focus on the long term. The markets have survived every election cycle and every combination of political control imaginable. We did not envision this one ending differently.
Hopefully you didn’t make any dramatic changes to your portfolio or asset allocation based on the outcome of a single event…that strategy is about as reliable as relying on the polls to predict a winner. If you didn’t do it correctly this time, don’t fret. This is America and the next election cycle is only 23 months away!
Laurene Brooks joined Legacy in 2004, shortly after the company’s inception. She earned undergraduate degrees in journalism and Spanish, and her Juris Doctor (JD) designation from Marquette University. Laurene has over 30 years of experience in law and relationship management. In addition to assisting clients with financial management and estate planning, Laurene is Legacy’s senior fiduciary officer. In addition, she was a member of the Real Property, Probate, and Trust Division of the Wisconsin State Bar for 10 years and served as chair.
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