(click on chart to enlarge)
Ironically, this is the one election that you should actually vote for the candidate that you "LIKE THE LEAST". Why? Because after the short, but probably very sharp rally that is due to begin between October 10 and Thanksgiving runs its course into early 2009 (forming wave B, or the intervening rally between two down waves: A and C), the following decline which will be wave C should obliterate the market lows of 2002/2003, causing financial dislocation not seen in the last 100 years. That dislocation will very likely cause the expulsion of the current government, or at least the leaders, mostly at no fault of their own.
This "scape goating" will become rampant, and take no prisoners. With this in mind, if you are an Obama fan, you don't want him to win Tuesday, as he will very likely be laughed, chased, or worse out of office before the 2012 election. Obama fans should prefer to have him lose Tuesday and be the shining light as the "what could have been" when the stuff really hits the fan in the next 2-3 years. If you are a McCain fan, you don't want him to win Tuesday, since he will receive all the follow-on blame of the Bush legacy, culminating in his early dismissal, if he lives that long. If he loses, although he'll be too old to run again in 2012, Sarah Palin could be viewed as "should have been" choice back in 2008.
Either way, the wave pattern is unmistakable, and ominous. Once wave B up exhausts itself in the 11k-12k +/-500 points in early 2009, the largest decline since 1929 is scheduled to visit not only American markets, but this time, the global ones as well. This is the first time in history that diversifying was the wrong strategy. In fact, complete concentration of assets should be highlighted into the coming wave B rally in the next 2-6 months as my 11k-12k target gets approached: 100% cash or T-bills will be the only survival plan that works.
So, again, ironically, for the first time in US history, voting for your favorite candidate will guarantee his demise as a viable political entity in the future, whereas voting for your least favorite all but guarantees several elections to come working in favor of your preferred party.
As they used to say in Chicago in the glory years of political machinery, "vote early and vote often".
For what it's worth,
Ken
