Wall Street banking on Obama victory, ready also for McCain

AFP ^ | November 1, 2008 | AFP

[Kukai]

NEW YORK (AFP) — Never mind the financial crisis: with just days before the American presidential election, investors on Wall Street are betting big on a win for Democrat Barack Obama.

But they wouldn't be unfavorable to an upset by Republican John McCain.

"Given Obama's advance in the poll, it's pretty clear who's going to be president," said Owen Fitzpatrick of Deutsche Bank.

If the markets decline between August and late October (which is the case in 2008), power almost inevitably passes from one party to the other, he said.

Of the six times this situation has arisen since 1928, only one time has the rule been bucked: the 1956 reelection of Republican Dwight Eisenhower.

But Blicksilver doesn't expect the markets to respond well to a Democratic victory.

"If Obama wins with a significant margin, I could promise you that Wednesday will be a very hard down day," he said.

With an Obama victory, investors "know that capital gains taxes are going up, and they'll say 'I don't want pay a third more in tax,'" he added.

According to analysis from the Brookings Institute, Obama's economic plan includes increasing the maximum rate of the capital gains tax from the current 15 percent to 20 percent.

"If McCain wins I promise you the market will go up 10 percent on the opening and stay up all day," predicts Blicksilver.

[Mad_as_heck]

If Obama wins I expect a big ugly in the markets and I’m worried about a run on the banks. A lot of people have heard the talk about 401Ks and don’t think their money is safe where Barry and Co. can get to it.

[ari-freedom]

With an Obama victory, investors “know that capital gains taxes are going up, and they’ll say ‘I don’t want pay a third more in tax,’” he added.

that’s it? haha it’s going to be a lot worse if obama wins.