2016 Election Analysis: Wall Street and Woodward Avenue Stand to Gain

 

Since Donald Trump's presidential election win, Facebook and other Social Media, as well as major media outlets have been bemoaning his unanticipated win.  The stock market, however, has decided that all of the most likely changes under a Trump administration are likely to be good.   Stocks have been rising, the Dow traded to a record high on Friday - as did bond yields, the US dollar, and inflation expectations have all jumped higher.   

RBC chief equity strategist, Jonathan Golub, weighs in "Over the near term, Trump's policies should play out in the form of higher interest rates, commodity prices, and business optimism."

So, what does that have to do with the price of Muscle Cars anyway?  Well, many people who currently collect investment quality automobiles have been sitting on the sidelines, keeping the equity held in their collections constant, waiting to see how things will shake out in this election cycle.   Waiting to see how the policies of the next administration were going to affect their businesses, retirement income, and investments.

Those who experienced the Muscle Car Era first hand openly wondered if anyone in future generations would even care about these cars in the future.  More importantly, what they stand for- self-determination, hands-on know-how, and a personal sense of power.  

The cognitive dissonance between what the Federal Government has been mandating and what consumers want played itself out in the market in 2016.  Full-sized pickup truck sales were at an all-time high, new mid-sized and compact sedans were considered in a slump so severe that every manufacturer- so much so, most major manufacturers chose to stop building them with U.S. labor or stop building them all together.  Government mandate for electric car technology development continues, despite concerns that consumer demand will be there to buy them. 

It seems only seconds ago that the corporate investment in electric autonomous appliances dominated automotive headlines, along with an industry that was groaning under ever increasing mandates for safety and fuel efficiency that outstripped their technological prowess and did not reflect desires of consumers.  Leading to both one of the largest safety recalls in history with Taka's airbags and the revelation that one of the largest car maker's, VW, resorted to technological fraud in order to comply with government mandate.   It left the private citizen worried, that if large and power companies were being knuckled under by unyielding governmental dictates, what hope have they to have their grievances would be given proper redress?

 

Brand new Camaros, Mustangs, and Corvettes saw a sharp decline in sales in the weeks leading up to the election, despite a near-record annual sales rate.  This could be attributed to a "worry factor" should Hillary capture the White House along with the promise of continued heavy-handed regulation and expand taxation.  The only modern muscle that bucked the trend was Hellcat Challenger and Charger sales.      

Along with the Wall Street Rally, advanced ticket sales for this year's Muscle Car and Corvette Nationals is unprecedented, 100% higher than in years past.  Perhaps self-determination, hands-on know-how, and a personal sense of power suddenly back in fashion, and Muscle Cars along with it.  In any case, see you this weekend!  

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