The Democrats may see trouble ahead but the loss of a 60 vote majority could help stocks and the dollar.
"The Constitution does not just protect those whose views we share; it also protects those with whose views we disagree." -Edward Kennedy
Good or bad, everything happens for a reason. Like the late Ted Kennedy once said, the constitution is working to protect those with differing views, especially those with views of the current administration in Washington.
The S&P 500 has rallied 69.9% since March 9, 2009 and the average American is fed up! In light of where we may have been heading a year ago and where we are today, this does not make sense. Or does it? After the close, the weekly ABC consumer confidence reading came in at -49 versus -47 last week and -50 a year ago. Consumer sentiment is virtually unchanged from a year ago as most consumers are concerned about their personal finances because Washington is not.
The nasty consumer confidence reading, combined with Scott Brown winning a U.S. Senate seat in Massachusetts, helps put things into perspective - Americans are fed up with the "Piggy Banker Spread" and the fact that Obama does not represent "change" in Washington.
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Also, the "Buck Breakout" theme got a lift from the events in the Commonwealth, as the dollar is once again looking more like a safe haven, trading at levels not seen since September 2009. Yesterday, the dollar index rallied 0.6% and is up 0.6% in early trading again today.