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#1783
Lance Thompson
280 Posts

Yeah………….the Dow just closed above 30,000 for the 1st time in human history today on Tuesday, November 24th, 2020 and this is an excellent learning lesson for you youngins here in the group. What's driving the market up right now? The fact that Biden won the election??……NO……What's driving this bull run is 2 very important things…..#1. The market is excited about the Pfizer and Moderna Covid vaccines which are both testing at above 90% effective, which is outstanding….Especially when you consider that the flu vaccine usually only comes in at only 50% effective, and also when you consider that the vaccines for diseases we’ve been getting vaccinated for for nearly 100 years such as measles, polio, lockjaw, mumps, whooping cough and others usually come in at 97% at the highest….So to come up with a vaccine that’s 90% effective within 1 year is absolutely outstanding, but in addition to that it was made public at the G-20 Summit of World Leaders this past weekend that the U.S. is expecting for the Pfizer vaccine to be approved by the U.S. FDA within the next 20 days…..So that’s the 1st thing driving this bull run, the soon to be released Covid vaccine. But the 2nd huge, major thing driving this bull run is the 2020 election results for all 3 combined government branches. With this election we’re going to have a Democrat President/Democratic House/Republican Senate which means we have “divided government”……If Democrats were to win control of the Senate in this Georgia Senate runoff election on January 5th, which the polls are showing is “extremely unlikely” we would have a Democrat President/Democratic House/Democratic Senate…..in other words “united government”, and the market HATES united government.

The reason the market loves “divided government” is because NOTHING WILL PASS and make its way to Biden’s desk without it having Republican DNA all over it. If it doesn’t have Republican DNA all over it, that legislation will NOT make it through Mitch McConnell’s Senate……it’s just not gonna happen. So not much legislation passed and signed by President Biden over at least the next 2 years will have much “teeth” in it which is what the market LOVES. That means there aren’t any major market changes on the horizon…….The market doesn’t like big changes in how things are done…..makes institutional investors nervous.

For all you youngsters, all throughout your lives you’re going to want to see your 401k retirement plans INCREASE which will take you closer and closer to retirement. But in order for that to happen you’re going to need to see as many bull market runs in your lifetime as possible……So what you want to see as little of as possible is “united government”……You’re going to ALWAYS want to see a President’s hands tied by “divided government”, whether he or she are a Democrat or a Republican……that’s always the best outcome for investors.