Why is the stock market up on election day?<\/strong><\/h4>\n\n\n\nFuente: Quora<\/a><\/p>\n\n\n\nWhat has the media class, and indeed many people, been saying for months now?<\/p>\n\n\n\n
Lockdown is bad for stock markets. The stock market only crashed in February and March due to the lockdown.<\/p>\n\n\n\n
What else is bad for markets? Uncertainty. So, the worst possible outcome is uncertainty.<\/p>\n\n\n\n
What has happened this week? France, German and the UK have gone into a second lockdown:<\/p>\n\n\n\n![\"\"](\"https:\/\/qph.fs.quoracdn.net\/main-qimg-b3e610ad154c0dac34ae1f0a1423310e\")
<\/figure>\n\n\n\nThe US election is uncertain<\/p>\n\n\n\n![\"\"](\"https:\/\/qph.fs.quoracdn.net\/main-qimg-a3864a07f4d4a5ded7482a9bf622aa02\")
<\/figure>\n\n\n\nWhat happened? US Stock Markets were up 2%-3% yesterday, alongside European ones.<\/p>\n\n\n\n
US Markets are up by between 2%-3.59% today. Ironically, CNBC has reported that \u201cRally gains steam even with election uncertainty, Dow jumps more than 500 points<\/strong> - Rally gains steam even with election uncertainty, Dow jumps more than 500 points<\/a><\/p>\n\n\n\nIf markets would have been down, the headline would read \u201cDow down 500 points on election uncertainty\u201d.<\/p>\n\n\n\n
The same thing happened in 2000, when stocks were up slightly during the 2\u20133 weeks of uncertainty after the Bush-Gore result in Florida, and in 2016 when they rose after Trump\u2019s victory.<\/p>\n\n\n\n
Before both events the media, and many people, were worried about a crash.<\/p>\n\n\n\n
I won\u2019t predict what will happen tomorrow or next week. Stocks could rise, fall or stay the same.<\/p>\n\n\n\n
What I am willing to predict is nobody will beat the market, or even match the market, by trying to time it based on news events.<\/p>\n\n\n\n
Yet every time markets are unconcerned, or even move higher, during events like government shutdowns, coronavirus or elections, people are shocked.<\/p>\n\n\n\n
So, a second prediction. In 2024, there will be many questions online about \u201cdo you think I shouldn\u2019t invest because of the election\u2026.\u201d.<\/p>\n\n\n\n
In reality, we will also get many headlines in the next four years about the lack of a vaccine and 1001 other events that \u201ccould shake markets\u201d<\/p>\n\n\n\n
Even in the coming days, if markets fall, the media will probably have a grand explanation for it such as the \u201cuncertainty\u201d.<\/p>\n\n\n\n
It is best to just switch off the media when it comes to investing.<\/p>\n\n\n\n
Better for our wallet (long-term) and mental health! Less worry and more profit.<\/p>\n\n\n\n
Why are so many big businesses and corporations not profitable?<\/strong><\/h4>\n\n\n\nFuente: Quora<\/p>\n\n\n\n
There are many reasons for this. Some of the reasons are sensible and logical, whilst others are not.<\/p>\n\n\n\n
Las principales razones son<\/strong><\/p>\n\n\n\n- A certain percentage of businesses reinvest in the early years. Even many big tech firms weren\u2019t profitable early on. This is an understandable reason if it eventually leads to success<\/li>
- Too many private business owners always want more – more profits, more revenue, more big office spaces etc. There is nothing wrong with that if, and only if, it leads to more profits. Yet in the same way many private citizens only focus on income, and not if their surplus (income – spending) is growing, some business owners love what I would call \u201cfake status\u201d. More flashy offices, cars, salaries and other unneeded expenses can make it look at those you have made it. Often times, keeping costs low can be just as important to profitability as making loads of money (revenue). People are more likely to focus on revenue than costs. This is a bigger problem for small and medium sized businesses, but it can be an issue for larger firms too.<\/li>
- Partially linked to point two, venture capital and outside money doesn\u2019t always help. Everybody in business wants to make money but if you are funded, you have a lower incentive in some ways. I personally know some business owners who are living the high life from other people\u2019s money, and they are promising profits later on. The lifestyles they lead look more glamorous than somebody selling candles from their back room as a 1-man-band online business, but it doesn\u2019t mean they are more profitable long-term.<\/li>
- In some systems, accounting rules can be manipulated to reduce tax bills in a legal way. This is especially the case if a firm has a holding company, and they shift the profits. This is complicated though and depends on the jurisdiction. In this case, some big businesses might want to shift profits to lower tax places like Ireland or Luxembourg, and make other businesses in their group unprofitable.<\/li>
- Some years profits might be high, and others years a big business might lose money.<\/li>
- Every dog has its day. Over-performance isn\u2019t always sustained long-term. Often that is because firms don’t adapt to changing circumstances and consumer rates. So, some firms that aren\u2019t profitable today, were in years gone by. Many firms also don\u2019t plan for the worst so when something like covid or 9\/11 happens, airlines and other firms always seem to get caught out. Few have the foresight to be a bit conservative for that rainy day.<\/li><\/ol>\n\n\n\n
So, there are rational reasons why a business might want to reduce their profits.<\/p>\n\n\n\n
More often than not, though, people aren\u2019t as laser focused on profits as they are on revenue growth and \u201cvanity measures\u201d like \u201cwe have offices in 100 different countries\u201d.<\/p>\n\n\n\n
How worried is the stock market if Joe Biden becomes president?<\/strong><\/h4>\n\n\n\n
What has the media class, and indeed many people, been saying for months now?<\/p>\n\n\n\n
Lockdown is bad for stock markets. The stock market only crashed in February and March due to the lockdown.<\/p>\n\n\n\n
What else is bad for markets? Uncertainty. So, the worst possible outcome is uncertainty.<\/p>\n\n\n\n
What has happened this week? France, German and the UK have gone into a second lockdown:<\/p>\n\n\n\n The US election is uncertain<\/p>\n\n\n\n What happened? US Stock Markets were up 2%-3% yesterday, alongside European ones.<\/p>\n\n\n\n US Markets are up by between 2%-3.59% today. Ironically, CNBC has reported that \u201cRally gains steam even with election uncertainty, Dow jumps more than 500 points<\/strong> - Rally gains steam even with election uncertainty, Dow jumps more than 500 points<\/a><\/p>\n\n\n\n If markets would have been down, the headline would read \u201cDow down 500 points on election uncertainty\u201d.<\/p>\n\n\n\n The same thing happened in 2000, when stocks were up slightly during the 2\u20133 weeks of uncertainty after the Bush-Gore result in Florida, and in 2016 when they rose after Trump\u2019s victory.<\/p>\n\n\n\n Before both events the media, and many people, were worried about a crash.<\/p>\n\n\n\n I won\u2019t predict what will happen tomorrow or next week. Stocks could rise, fall or stay the same.<\/p>\n\n\n\n What I am willing to predict is nobody will beat the market, or even match the market, by trying to time it based on news events.<\/p>\n\n\n\n Yet every time markets are unconcerned, or even move higher, during events like government shutdowns, coronavirus or elections, people are shocked.<\/p>\n\n\n\n So, a second prediction. In 2024, there will be many questions online about \u201cdo you think I shouldn\u2019t invest because of the election\u2026.\u201d.<\/p>\n\n\n\n In reality, we will also get many headlines in the next four years about the lack of a vaccine and 1001 other events that \u201ccould shake markets\u201d<\/p>\n\n\n\n Even in the coming days, if markets fall, the media will probably have a grand explanation for it such as the \u201cuncertainty\u201d.<\/p>\n\n\n\n It is best to just switch off the media when it comes to investing.<\/p>\n\n\n\n Better for our wallet (long-term) and mental health! Less worry and more profit.<\/p>\n\n\n\n Fuente: Quora<\/p>\n\n\n\n There are many reasons for this. Some of the reasons are sensible and logical, whilst others are not.<\/p>\n\n\n\n Las principales razones son<\/strong><\/p>\n\n\n\n So, there are rational reasons why a business might want to reduce their profits.<\/p>\n\n\n\n More often than not, though, people aren\u2019t as laser focused on profits as they are on revenue growth and \u201cvanity measures\u201d like \u201cwe have offices in 100 different countries\u201d.<\/p>\n\n\n\n<\/figure>\n\n\n\n
<\/figure>\n\n\n\n
Why are so many big businesses and corporations not profitable?<\/strong><\/h4>\n\n\n\n
How worried is the stock market if Joe Biden becomes president?<\/strong><\/h4>\n\n\n\n