With just 11 days to go to the US Presidential Election, every pundit worth his salt is drawing up the market risks and probabilities of the outcome despite the fact that no two elections can be the same. So making the assumption that more than enough has already been expended in the way of intensive analysis, here are 3, yes just 3, things to consider from previous elections: 1. Historically if a President has presided over an economy which has not entered a recession in the 2 years before the election, he will be re-elected. 2. If the performance of the S&P 500 is positive in the 3 months up to the election, the President will be re-elected. 3. If a President is re-elected, the US stock market performs more strongly than if a new President is elected. So, as can be seen with the US economy officially having entered a recession in Q1 this year, according to the National Bureau of Economic Research, the first test goes to Biden. The second test is in favour of Trump as the market has gone up by 3% since the beginning of August. So a tie on the first two with the third test’s outcome dependant on whether prosperity outweighs change in the minds of the electorate. History suggests that in the end most people vote with their wallets, but as everyone agrees, this election is the same as all the others…different.
Despite the negative polling for him, for the time being Trump remains in the race because….he is the incumbent President.
Luxury goods company Hermes famous for its (relatively affordable $450) silk scarves and (rather less affordable $12,000+) handbags is seeing more demand for its goods in the latest quarter after a collapse in Q2. However within that Q3 improvement it is a mixed picture: sales up 25% in Asia but a fall of 15% in Europe and also a fall of 5% in the Americas. Sales totalled $ 2.13 Billion in Q3 and Hermes shares are up 20% since January 1. Because Hermes is the first luxury goods company to report, the pressure has been piled on the other companies and particularly on those who have not had that same pick up in turnover in Q3. And for those of you wondering about the picture within Europe? Yes sales in France of Hermes goods are down an unprecedented 23% in Q3.
Mon dieu the honour of France is at stake! First the indignity of Emily in Paris and now this.
Yes it was this day in 1976 that rock band Chicago renamed from their original name of the less than catchy and also confusing Chicago Transit Authority, stormed into both the US and UK charts. In fact the name change was more to do with threatened legal action from the actual Chicago Transit Authority- no sense of humour those mid western American transit titans. The name change paid off in every way and If You Leave Me Now became a global staple for clubs and parties in the small hours and here’s why:
If you leave me now you’ll take away the biggest part of me
No baby please don’t go
And if you leave me now you’ll take away the very heart of me
No baby please don’t go, no I just want you to stay
A love like ours is love that’s hard to find
How could we let it slip away?
We’ve come too far to leave it all behind
How could we end it all this way?
When tomorrow comes and we both regret
The things we said today
Have a great weekend, wherever you are!
Discussion and Analysis by Humphrey Percy, Chairman and Founder