Obama Wins: What's Next for Your Personal Economy

U.S. President Barack ObamaBarack Obama has been re-elected as the president of the United States.

A nail-bitingly close election, with the economy consistently being named as the top issue, has been decided.

Here are a few things to keep in mind.

What Should I Do With My Investments?

Probably nothing different than you were before. If you were happy with your portfolio and investing style three months ago, you should be happy with it three months from now. Making investment decisions while heated about an election outcome puts you in the express lane to regrettable decisions. If you truly want to tweak your portfolio based on tonight's election, here's my advice: Do it next week. Take a few days to cool off. Think it over. Talk to others about it. A few months ago I wrote about the history of market calls based on winners of presidential elections. The vast majority are dead wrong in hindsight.

What Happens Next?

The odds were good that, no matter who won tonight, the economy was going do much better over the next four years than it did over the past four. Housing construction and auto sales are set up for a big rebound, the boom in domestic energy production is simply staggering, and household debt payments to income are at the lowest level in almost two decades. The tailwind of those three combined shouldn't be underestimated.

Things have been looking up for a while, and President Obama's victory neither solidifies nor weakens that view. Ezra Klein of The Washington Post wrote a smart article Monday with the headline: "Neither Obama nor Romney will turn America into a bleak hellscape." Look past election-season hyperbole, and neither candidate was radical in any historical sense, and the winner would have inherited an economy with the wind at its back.

The Big Asterisks

Enjoy the moment, Mr. President, because you're soon going to be facing with one of the most serious threats to the economy in years: the fiscal cliff. On Jan. 1, $607 billion in tax increases and spending cuts mandated by previous laws (some more than a decade old) go into effect. Neither Republicans nor Democrats want to see this happen in its entirety, but the two parties (surprise) can't agree on how to mitigate it. So, now begins what is likely to be weeks of vicious bickering and backroom negotiations. No one knows how this will play out. My guess: Obama will propose a fairly small deficit-reduction package extending over the next six months, and the hard decisions on long-term budget reform will be kicked down the road anew. And you thought political season was over ...

What Did We Learn Tonight?

Legions of conservative-leaning pundits made predictions suggesting a Mitt Romney win was a sure thing. But there are no sure things. Things change, and you have to be prepared for alternatives. Elections are a good reminder that predictions -- including those about investments and the economy -- should be done using probabilities, not certainties.

What do you think about tonight's results? Share your thoughts below.

The article Obama Wins: What You Need to Know originally appeared on Fool.com.

Barack Obama Wins Presidential Election 2012



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361 Comments

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Gregg

The maggots and the leeches won this one. They have discovered how to vote themselves more free benefits Thx to Uncle Obama.

November 17 2012 at 11:00 PM Report abuse rate up rate down Reply
Fred Miller

Your commentary seems to have not considered the astronomical absolute value of the Debt or it's share of GDP that already exists AND the shift in demographics to an older non-consumer spending age cohort AND an age group that is and will continue to downsize in the housing market AND the age group that will increase the demand for health services AND the declining ratio of producers (taxpayers) to retirees (beneficiaries). With one exception, I cannot think of a way to resolve the Debt impact of these changes. THE EXCEPTION-PRINT MONEY

November 08 2012 at 5:34 PM Report abuse rate up rate down Reply
Hi Millionaires

We appreciate all those who did not vote. You influenced all of us. We appreciate all those illegal's who did not have to show identification. They for sure were for Obama. We appreiate all those who view Obama as Santa whereby they need not work and receive $60,000 in benefits. We appreciate all those women who are so concerned that they can have abortions at anytime, anyplace and that we are paying for their sex. We appreciate all those who said, big government is great and now here we are!

The day after the election and the same old, same old. Our president is sattled with a new decision. Just maybe we will enter a new "recession." Didn't you know we were out of the recession. Probably so, we most likely were into a depression if we were honest.

Times will be much tougher. Did you forget about the tax cuts being let go and the new taxes in Obamacare. Who do you think will pay for the 4 million Obama borrowed from Bank of America for his election? He has to pay it back within 8 days of the election? Folks, you will pay through your taxes.

Dependency, despondency that's what you invited. Same old, same old and still we are blaming whoever because in reality we are scared and rightfully so.

The buck stops here said Truman. Where does the buck stop with Obama?

A government big enough to give you what you want is a government big enough to take it away. By Thomas
Jefferson-----Does it ring with truth?

November 08 2012 at 11:04 AM Report abuse +2 rate up rate down Reply
sedegolf

Get ready,Obama will try to change the Constitution or get rid of it. He will cut deals with,Russia,Iran,Syria,France and anyone who wants to destroy our country. Our Dollar will no longer be the Mainstay of oil purchases. He will stop coal production in the name of clean air and your utility bills,gasoline,oil prices will double in two years. He went from a 300K
Self worth to 10million in 4 years and he will be worth 100 million in four more years. He also will try to get elected for 4 more years in 2016 . the man is a Marxist period.

November 08 2012 at 10:21 AM Report abuse +1 rate up rate down Reply
lkwms8253

Yeah I'm so excited about getting a huge tax increase January 1st, 2013. 83% of American households are getting the increase after the Bush/Obama tax cuts expire of $3700 to $4100. I think that 83% of American households will include the 47%, the 99%, Blacks, Latins and single moms. I was going to buy my wife a new car but not with this additional tax burder. Nice going America electing the socialist. My research comes from the CBO you know the non-partisan Federal Agency the potus uses when the math suits him.

November 08 2012 at 10:15 AM Report abuse +1 rate up rate down Reply
t28c

We will never know the truth why four men died in Bengahzi just as we will never know the truth about “Fast and Furious” . And In less than 4 years the National debt will be beyond $20 trillion ($20,000,000,000,000), More people will lose their full time jobs and be part time workers, The cola formula will be adjusted to give less to those on Social Security, the total number of young people looking for jobs will be higher, Congress will give itself a hefty raise to compensate for the loss of buying power of the dollar. We will indeed see a fundamental change in this nation as we would after any funeral.
If your young , make sure you have a secure income and do not take any unnecessary risk with any "quick money" deals. Get rid of as much debt as possible and work towards getting rid of the mortgage as soon as possible. If your in the over 55 group, do not buy anything you do not need. get out of debt, conserve your money. Your IRA and retirements will be diluted.

November 08 2012 at 10:14 AM Report abuse +2 rate up rate down Reply
Lou

welcome to the u.s.s.a.............united scolistic states of america

November 08 2012 at 10:07 AM Report abuse +1 rate up rate down Reply
hdstylin

The PARASITES won the election. Kiss your money goodbye.

November 08 2012 at 9:49 AM Report abuse +3 rate up rate down Reply
ppauldmarch

DID ANYONE FORGET THE IMPEACHMENT PROCESS OVER BENGHAZI? IT COULD SAVE US, AND IT WAS LIES AND COVERUPS

November 08 2012 at 9:33 AM Report abuse +2 rate up rate down Reply
Andrea Jean

Sadly, the America I grew up in is gone now. This election was the last opportunity to ensure there were more givers than takers and over the next four years more people will apply for and receive food stamps and money from the government. They will never vote for anyone that will take away their "entitlements". The major job growth we will see will be in the federal government (16,000 new IRS agents alone to support oBUMacare) with more and more restrictions and taxes on the small business owners aimed at shutting them down. The unions will become stronger. Even now if you work on a project paid for with stimulus money you are required to be a union member. Virginia had to completely rebid several of it projects and eventually reduced what it could do because of the union clause - and it is a right to work state. This is not my country any more. I feel as if I had a death in the family. Were it not for our children and grandchildren we would look into living elseware. I am so very sad about this.

November 08 2012 at 9:19 AM Report abuse +7 rate up rate down Reply
1 reply to Andrea Jean's comment
luckycur

Many of the entitlement programs were created by the GOP, likethe Earned income & Child Tax credits. There will be no 16,000 new IRS agents, that was a rumor perpetuated by the GOP. AS for Federal job growth, start whining about the 320,000 people hired for the Department of Homeland Defense, started by Bush. Finally, whether you disliked Bush or Obama, they are Figureheads, and lack any power to change policy, or determine spending. If you had listened in school, you'd know the Congress & Senate approve ALL policy and ALL spending. Anything said and done by a President can be over ruled. ObamaCare remains, even though the Congress could overturn it with a Simple Majority, because the stocks are booming.

November 08 2012 at 10:34 AM Report abuse rate up rate down Reply