Does Post-Election Market Drop Mean It’s Time to Buy?

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Less than 12 hours after President Obama was re-elected, the Dow Jones fell 300 points, and has continued to head lower. It appears many investors are "knee-jerk" selling because of the president's second term.

The last time President Obama was elected, in 2008, the markets hit lows just a few months later. Early 2009 ended up being one of the best buying moments in history for stocks – does this mean we should be loading up?

Money Morning's Chief Investment Strategist Keith Fitz-Gerald appeared on Fox Business' "Varney & Co." today (Monday) to discuss this post-election market and where to find the current buying opportunities.

Asked about those selling the markets now that President Obama has won a second term, Fitz-Gerald responded, "That is the worst possible thing an individual investor can do. You need to be in the markets and you need to be in the markets for appreciation and income, and you need to use things like trailing stops, for example, that automatically make that decision for you."

Check out the accompanying video to find out which sectors and industries Fitz-Gerald is eyeing up now.

Join the conversation. Click here to jump to comments…

  1. H. Craig Bradley | November 12, 2012

    BANANA REPUBLIC

    There is little doubt in my mind that eventually, the Federal Government will expropriate private (individual) pension assets ( Tax Deductable IRA's and 401 K's). There is simply too much money sitting around out there for it to be ignored. Remember, Argentina did this very thing a few years ago.

    The Federal government will gradually become more and more desperate as they fail to realize revenue increases from " tax the rich" rhetoric and tax policies. The more we become a "Banana Republic", the more we will act like one. The Government will need to get their hands on real money and individual retirement accounts are where the most available liquid assets are concentrated.

  2. Deborah G Flynn | November 13, 2012

    I have investments in the market and tight stops. When A stock goes closer to what I paid for it it goes automatically. I get the dividends and appreciation and move on to another opportunity. Right now Gold is a good bet because people have ZERO faith in OBAMA I;'m not talking about the idol worshippers waiting for his Santa Clause largesse I'm talking about Prudent people who actually know they have to take care of themselves.

    • Robt | December 2, 2012

      Beware, I believe this to be true that all down STOPS work only during market open hours, not pre-market or after market hours where a lot of trading continues to go on. STOPS do not protect prior to or after normal day time hours of 9:30am – 4:00pm EST. Theoretically your equity price could go to zero in pre & after-market hours. However, check this out with your advisor or broker.

  3. H. Craig Bradley | November 15, 2012

    CAN OF WORMS

    The problem with all these articles is they never end. Its not unlike the proverbial “can of worms”.

    An equally bigger issue at hand is the little matter of retirement and yes, funding the Federal government’s ever increasing debts. The U.S. Treasury knows it won’t be able to indefinately continue selling sufficient quantities of T-Bonds in the open market to meet funding needs. So, some other source will have to be tapped. Do you know what this new source of funding for the Federal Government might be? Private Pension Accounts, commonly known as IRA’s and 401 (K)’s to the tune of $16 Trillion dollars!

    Proposals have already been floated, including one published in the Federal Register (Volume 75, No. 21, Tues. Feb.2, 2010, 26 CFR Part 1, RIN 1545-BJ04), to nationalize private pension accounts. Of course, the Feds won’t sieze them right away, but they have plans to force the ‘conversion’ of existing tax deferred retirement (pension) accounts into new Guaranteed Retirement Accounts or GRA’s.

    These new government sponsored ‘investment’ vehicles would invest in annuities which would then be required to buy Treasury debt. Plus, every working person would be required to contribute 5 % of their gross wages into these new GRA’s (no tax deductability). Oh, its not a tax, again. Plus, lots of strings attached. You lose control of the account.

    There are certainly many more worms left in your can Keith. For starters, the coming domestic oil boom is going to fuel an economic boom. Ditto with the export of surplus natural gas starting in 2016.

    President Obama is a lucky man, he will harness (harvest) this new economic growth and Federal revenue into more government entitlements and constitutents (voters), who will then demand a third Obama term in 2016. See where this is going. There is no going back from the choices we have already made as a country.

  4. Tim | December 8, 2012

    Third Obama Term? You mean a substitute to carry on the wearing away of the US lifeblood probably. Third terms went out with LBJ. He had the option, and nominally Truman/Eisenhower at the same time, but it is now an ammendment to the constitution.

    Hard to say if what you forecast comes up. Lots of Black Swan events are possible to finally upset the apple cart so much that it will never be the same. But then the minions will pounce on the crisis too good to waste. Waste, such an apt fixation for such maggots.

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