Market Cycles:Election Years

Eric LaneAssociate Manager, Finance Sector

Disclaimer

My…… political philosophy

…… political history

Why none of this matters

A Brief History of Time

How HAVE the markets performed during Presidential election years?

S&P 500: 1/1999 – 12/2007

The 4-year Cycle: 1950-2004

2008 – A Different Kind of Election

Now onto the present……

The Iowa Electronic Market

Democrat or Republican

The Iowa Electronic Market

Democrat Nomination

Democrat President in 2008?

Traditional Winners Traditional Losers

Metals Trade Regulations

Alternate Energy and Environmental Cleanup

Freddie Mac/Fannie Mae

Homebuilders

Oil and Gas

Pharmaceuticals

Insurance Providers

Defense

Big Pharma

PHLX Drug Index

Big Oil

PHLX Oil Services Index

Barack Obama (D)

Senator from Illinois

Policy Platform Cracking down on mortgage fraud Helping homeowners avoid foreclosure Middle Class Tax Relief

"Making Work Pay" credit American Opportunity Tax credit

Retirement Security Health Care Reform Alternative Energy

Hillary Clinton (D)

Senator from New York

Policy Platform

Ending the foreclosure crisis Stimulus Package High-wage job growth Health Care Reform Leveling the Economic Playing Field

Strategic Energy Fund Special Interest reform Health Care

Trade

John McCain (R)

Senator from Arizona

Policy Platform

Pro-Growth Tax Policy Keep tax rate low Make permanent Bush income and investment tax

cuts Cut the corporate tax rate Ban Internet and cell phone taxes

Social Security and Medicare Trade Health Care Market-based energy reform

The Best Option?

Gridlock.