2016 did not have a great start in terms of growth within the economy. The commonly held prediction or expectation was that the economy would rebound in the summer months, but it did not do so. Many think this falter is a result of the current political climate maintained by both Hilary Clinton and Donald Trump. Right now the country's comfort level and confidence in the future of the US economy is very low and this, in part, the reason for the is very low with the future of the economy. Almost 20% of the S&P 500 companies indicated the countries election process is a "red flag". The fear is that Americans will keep refrain from spending money as a result of their fears of what will become of this election. Corporations are already decreasing their spending on new research and development for the future. The election process is crazy that Diane Swonk of DS Economics states "One would have to be foolish NOT to be uncertain. Corporate spending is very important to the economy, but it is consumer spending that makes up over 70% of the US economy.The bottom line is that the US and global economies for that matter are not in a great state and this election is only adding to the concerns for the future.
http://money.cnn.com/2016/09/21/news/economy/us-election-economy/index.html?iid=SF_River
Consumer uncertainty can most definitely raise fear of future economic decline. Consumer spending has by fair the biggest impact on the economy, 70% is no small chunk. This is something that people might be thinking about affecting our economy, one can only hope that this election doesn't turn these fears into reality. We can't afford for consumers to become hesitant to spend, this is a good topic.
ReplyDeleteHistory implies that elections have an effect on the market, but only when the outcomes are predictable. But today's elections are far from predictable. Both candidates don't reference economic policies in regards to their presidency besides snide commits. If 70% of the economy is made up of consumer spending and uncertainty is the general consensus growth is very slow. The future is always a concern, but with two candidates that differ on extreme sides of the spectrum, it is a toss up for what's in store for the future. Both the market, consumers and sellers, must be wary of their investments and finances in the future.
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