As I said, the Euro will reach par and displace the dollar, and it already has only one day after election: rate at end of 11/5 1.0029 Euro per dollar, as of 11/6 99.2457 Euro per dollar. The other part of the impact I mentioned was capital flight. The spin for the markets' poor performances today on a day they should have soared on news of the 50bps cut by the Fed was very interesting to read. The reality of capital flight is something the vast majority of financial world pundits, let alone speculators or most members of Bush's administration, have never contemplated, except, maybe, as something that happens to other countries viewed as "unstable." The overseas person or institution with serious money here knows just what a Republican victory actually means: absolutely no reform of a system that is out-of-control and the institution of policies ruinous to the primary factors of any economy's performance. So what does this mean? With the prime consuming season upon us, the balance of payments skyrockets and the current account must be balanced with new inflows of capital; but what happens when there's not enough inflow to balance the account? The whole financial market's current condition will be turned on its head, with resulting pandemonium, and we only need to look at Argentina or Brasil for examples of this. Add to the mix the fact that the government is running close to record deficits and the Fed's rate cut looks laughable because interest rates will skyrocket as businesses and consumers get crowded out as the Treasury scrambles to cover a $1/4 trillion combined *quarterly* deficit--and it can't print money its way out of the situation because of the nature of the trade deficit. Can you spell CRISIS? Being simpleminded and focused on global control instead of the means for doing it, Bush and company will start their conquest of the middle east. This results in both deficits spinning even farther out-of-control. Where this will end up is anyone's guess, but it won't be pretty as the empire implodes from the economic weaknesses of its own design and an economic winter of vast proportions engulfs the world.
Those who support the election results and the current administration should do a quick hard think on just what they really mean. But if any real thinking was done by folks, then we wouldn't be facing the above situation would we?