Now that we know the outcome of the election, it it time to sell up and get out of the market?
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Hi @Dx3,
It sure is!
I sold a bunch of our Wells Fargo (WFC) this morning, about 4% of the position when it suddenly rose over 14% today.
That is it. That little bit.
If you are going to sell-out based on an election, you should sell-out since we just had one.
Other than that, just hang on.
Does that help you?
Gene
All holdings and some statistics on my Fool profile page
Profile - gdett2 - Motley Fool Community (Click Expand)
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As apprehensive (scared?) as I am about the next four years, I am not currently expecting to do anything at all differently with my investments. That may change, of course, but I’m ready to wait and see how things unfold. I have found patience to be my most successful investing virtue.
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It’s not the election per se, it’s the impact this will have on the global economy. As income inequality will become more and more of an issue in this country, it has to have an impact on a “free economy” as trump’s tariff policy will negatively impact the average person’s bottom line. If people are upset about having to pay 10 cents more for eggs, imagine how outraged they will be when they can no longer put a roof over their family’s head. It seems to me we are looking at an incredibly unstable future and I want to be prepared for it.
I would love to be prepared for the future, especially when things are unstable. However, things being unstable, I do not know what the future will bring. One might develop some ideas based on what you expect, but expectations are often not fulfilled as we expect. To say nothing of the law of unexpected consequences.
Note that in a few years, after we do know what we can’t know now, there will be all sorts of analyses about what we should have done.
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Yes, that is exactly why I was looking for opinions on the pros and cons of his promised policies (such as tariffs). and how they might impact the economy.
Perhaps more importantly, in the last 100 years, only once has the market been positive after two consecutive years of 20+% returns. The late 90s have the single entry for that data point.
AI could potentially do something similar but it is unlikely to lift all boats in quite the same way the internet did in the late 90s.
I am personally getting ready for the downturn to start in either the end of the first quarter or sometime in the second quarter. I am greedy so I am not quite ready to jump ship yet but it is going to happen soon. If I see the Fed start to second guess the direction of interest rates or we start to see inflation data go back up, that might be my signal. The market is already expensive and it isn’t any cheaper after today.
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Thank you. That is the type of input I was looking for.
So on another note, what are the estate and other financial implications of the election result? I think it’s a good bet that the 2017 tax law will be made permanent, for one. There’s less need for the wealthy-but-not-megawealthy to use up their $14M estate tax exemption within the next year. It’s less clear if Trump can really end taxation of SS benefits, Tips and overtime work.
The current estate tax law with $13.9mm unified estate tax exemption (double for married couples) expires end of 2025. Then exemption falls to $5mm but by inflation adjustment to $7mm.
Tax cut is likely to be a priority for the first hundred days. Many other aspects to be negotiated. Will probably hear details of his plan by state of the union or maybe inauguration speech.
Indeed its all about what he can get through Congress.
Who gets that tax cut? The wealthy, again?
The major plan is cut corporate taxes. But the tax bill will be huge with many changes at least desired. As always.
Tax bills get lots of attention. And do much to fill the campaign contribution coffers. They are very popular in Congress. And something always passes.
Actually, there were three times two consecutive calendar years had 20%-plus returns (1935-36, 1954-1955, and 1997-1998), and the last two had a positive return the next year.
20% is a round number, but somewhat arbitrary. If you use 19%, there are 6 cases, with 4 having a positive return the next year. If you use 15%, there are 11 cases, with 7 having a positive return.
None provide any statistical strength, but I don’t think it shows there’s strong odds of a negative return the next year. If anything, it indicates the opposite. 
No predictions from me, though.
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Sure it is arbitrary, but then both this year and last year are well above 20% as well so it isn’t like I picked an arbitrary high number. As of today, both last year and this year have gained over 25%. How many times has that happened and the market been positive in year 3?
Simple fact, the stock market cannot perpetually continue to grow at a rate faster than the economy. At some point it either has to go sideways or give back some gains. The rarity, whether it has been once or just three times in the last 100 years I think is valid cause for concern. Your mileage may vary.
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There is a pretty good post over on the paid side with some possibilities about the impact the next administration’s policies might have on the economy. For those with access it might be worth a look.
https://community.fool.com/t/why-are-homebuilders-falling/674900/10
The post also gives a link to where they got what they posted.
I’m not endorsing anything, just suggesting it might be of interest.