Hello Everyone. This is Sean.
In filling in for Nate this week, I decided to take a stab at finding the silver lining in yet another tumultuous week on Wall Street.....................
In preparation, I did an article search on the Wall Street Journal website for "good news." First hit on the list: Obama. Given the election coverage, I can't say I was all that surprised. Regardless of political affiliation, it appears that Wall Street is looking to the President-elect for direction. Today's end of day rally (494 point rise in the Dow Jones Industrial Average, 47 points on the S&P 500) was attributed to news that the NY Fed President Timothy Geithner will be nominated as President-elect Obama's Treasury secretary. An economist and Fed veteran, Mr. Geithner adds experience as the central bank's liaison to Wall Street and was a major participant in discussions regarding Lehman Brothers and AIG. There are plans to introduce the entire economic team on Monday.
Uncertainty is one of the many factors affecting this market. As announcements of other appointments (especially the economic team) become known, they should reduce some of the uncertainty surrounding the next administration's policy. If the economic advisors the Obama team leaned into during the election are any guide (Volcker, Buffet, Summers etc.), the market should view positively the depth of experience and leadership his appointees bring to the table.
Though the news coming from the economy may not be positive. There is "hope" (forgive my audacity) :) surrounding the new leadership to tackle the tough decisions ahead.
Given the holiday next week, we expect decreased trading volume. In the past, this has meant a "slow" or less volatile market. Given the current state of affairs, we might see a bumpy ride instead.
We continue to look for value and opportunity in the equity markets and invite that you contact us with any questions or concerns.
-Sean Mansell
smansell@evanstonadvisors.com
nsnodgrass@evanstonadvisors.com
