Political Parties and InvestorsOne of the challenges for investors is to determine whether a change in Government will change things in a significant way for investors. What I have seen over the decades is that most of the time, a change in Government doesn't really change much for investors. usually when it does, it is unexpected and usually precipitated by some external crisis.
So the question is - "Will this time be any different?"
My read on this is summed up as follows - "Not much"
Investors in Canada are largely reliant on what happens in Canada and the United States. So let's start there.
The US
The US is running multi trillion dollar annual deficits as far as the eye can see. The Republicans historically and recently through the Debt Ceiling deals have basically accepted this and won't change much. So a change in Government won't change much in this regard.
Trump has made a big deal about EVs and the "Bloodbath". IMO he will impose tariffs on cheap Chinese EVs but is unlikely to change much regarding the timelines regarding adoption of EVs as a proportion of new car sales. In addition, much of this is in the hands of State legislators anyway (California is a good example).
So this means that, the US Government will continue to have a stimulative stance through annual budgetary deficits and will continue to crowd out business and personal investment money keeping interest rates high. So this will make it difficult for the Fed to lower interest rates very much. The 10 year TBill in the US is at 4.5% and I don't see this going lower much more than 50 basis points at best and at worse could actually go up.
On the EV front, EVs in the US are still more expensive than their ICE equivalents and without cheap Chinese imports, this situation will continue. For TSLA there is growing skepticism that Musk will actually deliver a cheap model as he has now focussed on robocars with his recent announcement. In California they already have robocars in selected areas such as San Fran but for intents and purposes they are simply competing with Uber and Lyft. So in the short run nothing will really change and the same is true over the long run.
Canada
A change in Government will result in the much hated carbon tax being eliminated. IMO this won't change much for investors and if anything will make things worse since it would likely increase the federal annual deficit.
Trudeau has announced over the past couple of weeks, approximately 27 billion in new spending (reminding me of his daily COVID announcements). While things he announced like the housing plans won't change anything, they are unlikely to be scrapped by a change in Government. So in Canada, like the US, Government annual budgetary deficits will crowd out private requirements in the debt market and so the BOC will have difficulty lowering interest rates. So again, not much change from the current situation.
So the bottom line is simple. Whatever your current scenario is, don't expect a change in Government in the US or Canada to have much of an impact.