We’re kicking off 2021 with some big news! There won’t be a “Goldilocks gridlock” on Wall Street after all following the Georgia Senate sweep for Democrats Raphael Warnock and Jon Ossoff. So what will the stock market look like now that Democrats are in complete control?
Over the past few months, gridlock has been the expectation. Since November’s presidential election, Wall Street been pricing in a “Goldilocks gridlock,” and it all came down to Georgia. Gridlocks are thought to be good for business… hence the Goldilocks moniker.
But as 2020 showed us: No one really knows for certain what’s going to happen!
Now, two branches of the federal government are turning blue, including those in charge of the country’s purse strings.
The Democrats won the Senate runoff and the stock market is trying to correct itself from its Goldilocks gridlock forecast.
Everything I’m hearing about the Georgia Senate sweep is all speculation — more stimulus, higher corporate taxes and long-term gains. So today, I’m going to dive in and share what is valid and what is just a short-term overreaction.
Georgia Senate Sweep: No Goldilocks Gridlock
People are looking at this Georgia Senate sweep with two different outlooks. Some think it’s all doom-and-gloom and the end of the returns we saw during President Donald Trump’s four years, which began with Republicans in control of Congress and the White House.
Others are hopeful that the “blue wave” will mean more stimulus that should provide an economic boost — which Wall Street will love.
I have to say that although this news is big, it’s not going to fix all your problems if you’re a Democrat… and the world isn’t ending if you’re a Republican. It’s just another factor to consider.
A few sectors are trending upward since the decision: banks, pot stocks and solar/renewable energy.
This first day following the big news is showing a renewed interest in pot stocks as well. The federal legalization of marijuana was already expected to come at some point. But with a full Democratic Congress and a Democrat in the White House, that could be fast-tracked.
So what’s a good play and what is just speculation?
Check out my video below to get my reaction to the Georgia Senate sweep and see which stocks to buy sans a Goldilocks gridlock.
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