John Coyne, Vice Chairman
Growing up in an extended family passionate about politics, I have been watching elections closely since 1968. It seemed that every four years if “our guy (now gal as well)” didn’t win; go get Marlon Brando and remake the movie Apocalypse Now. The world as we know it was over, the economy would collapse and…life went on.
Most importantly, let’s first remember that the fear and anger that is driving these apocalyptic visions are being created by the media’s desire to sell advertising! Now I am the first to admit that there are characteristics to this election that are different in many ways than we have seen in the past and they center on the historically high unfavorable ratings of both presidential candidates. Nevertheless, we have not become the most envied democracy in the world by accident. Regardless of the rhetoric, both parties will accept the outcome and we will have a new President of the United States and a new congress in January. Will they be as ineffective as some believe they have been in the past? Maybe. What is for sure is that our lives will continue, people will retire, get married, divorced, change jobs, fight illness and move forward. And they will need to invest in order to deal with all the mundane components that make up our hopes, dreams and anxieties.
Our friend Dan Clifton at Strategas Research Partners has been providing us with some of the most outstanding “in the moment” political and market analysis for the past 18 months. He has been doing this with an eye towards providing us with the sectors of the economy that will be impacted by the makeup of a government whether all Democrat, all Republican, or a mix. He has deftly pointed out the potential winners and losers by sectors and asset classes and provided historical context to demonstrate that the presumed wisdom that says we do better with this party or that is never always the case and often is the exact opposite of the believers assumption. He also notes that active investment managers understand this.
Chuck Widger, Brinker Capital’s Founder and Executive Chairman, has been educating advisors and investors throughout his career on the idea that emotions can wreak havoc on a lifetime of careful planning. He uses a bucket approach to categorizing assets that you could consider adopting in light of the election results. Are your safety assets going to remain that way? Highly probable. Are your income assets going to continue to work? The Fed has more influence than the President of the United States, but much of these investments are already locked in. It is more important that you have a good manager going forward than worry who the next Speaker of the House will be. What about your accumulation bucket? Your long-term money will outlast this incoming administration and probably many beyond it. Regardless of who is elected, there will be times of turmoil and unbridled enthusiasm. The only thing that is predictable is that in the proper hands your investments will compound over time.
So put on your seatbelt and get ready for a nasty, scary ride for the next few days…but leave the portfolio alone.
The views expressed are those of Brinker Capital and are not intended as investment advice or recommendation. For informational purposes only. Holdings are subject to change. Brinker Capital, Inc., a Registered Investment Advisor.