Whatever we may think personally about Barack Obama’s win in the US Presidential elections, and for many people it will be a welcome change from eight years of George Bush, there is no doubt that this will affect everyone on the planet.

Ignoring political issues, and the difficulty we outsiders sometimes have understanding the difference between the republicans and democrats, this is a momentous occasion for many reasons; not least of which is the potential impact on investments.

A new broom
Obama has promised a change in US politics and for many people this comes not moment too soon. It is not that he is weak on the war against terrorism – far from it – but that he represents a new generation of politicians who appear more interested in listening to electors. His background suggests that he will find it easier to empathise with ordinary people than the ‘plutocrats’ he replaces.

Hope for millions of disadvantaged Americans
But his real long term contribution may be the hope that his election brings to millions of his more disadvantaged citizens who will, from January, have a beacon in the White House; not just showing them that there is something to aspire to, but also that they are no longer second class citizens.

A new tranche of laws enhancing social and racial equality may not happen; but this is irrelevant. What could come quickly is a renewed sense of purpose within groups of people who may previously have “given up” and – in the case of the housing market – simply walked away from their homes, abandoning them and the mortgages used to buy them to the scrap heap.

It may not be too fanciful to imagine that the Democrats win, led by the first Black-American Presidential candidate, will actually go a long way to supporting the ailing US housing market – and thus banks and investment houses all round the world.

A boost for equity markets
Equity markets are currently well below their historic trends. In fact, the FTSE100 ended October almost a third lower than the long-term trend (from 1984). This means that markets are probably due for a recovery soon.

It is quite possible that there will be an ‘Obama bounce’ as markets become more confident about the future. Even if this does not occur, many people are likely to consider that current market conditions indicate a buying opportunity.

If you are wondering what to do, about your investments and retirement planning contact Robert Bruce Associates for individual assistance?