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Darius Dale and Michael Gayed: Uncovering the Secrets of Global Liquidity & US Business Cycles

Lead-Lag Live

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The Importance of Liquidity in the Pre-Electoral Cycle

When the impulse is positive, you tend to have positive appreciation or positive price momentum. In pre-election years on average liquidity tends to rise and that's one of the reasons why pre- election years are strongest in four-year presidential cycle. But as bears, we are fighting some kind of like voodoo - I don't really know how else to describe it but it is serious voodoo. There's only two instances in 1946 where the market bear occurred during a midterm election.

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