Question

After reading the short article "How a Presidential Election Year Can Impact the Economy" by Jennifer Stinnett, answer the following questions.

• The Stinnett article is fairly high level. What have you learned about interest rates and the fixed securities markets that can provide evidence to support or refute the claims made by Ms. Stinnett?
• This article was posted in anticipation of the 2016 Presidential election. What has happened in the intervening time, and in the current election cycle, that influences your interpretation of this article?  

The article is very short and can be found through a quick google search of the title.

Answer 1

Ms. Stinnett has made claims that is more about government policies and its impact upon different markets, leading to uncertainties in the presidential election year. But, her claims can be refuted by using the interest rate as it is decided by the Federal Reserve and it leads to impact the fixed securities market. Here, Fed has not do with the election year, it has its own inflation rate and interest rate targets that are changed with the change in money supply. It affects the fixed securities market as well. But, these changes are independent of the election year. Hence, some of the markets are still there that are not uncertain in election years, rather, are drive by Fed's policies.

In the intervening time, the president has repeatedly shown Committement to make America great again, showing hostility towards the trading partners and indulging in trade war against China. But, recent election year, has not changed my perspective because Fed is still operating for the betterment of the economic goals and in the light of COVID-19 pandemic. Hence, it can be said. that president may affect the policies, taken up by the government, but it is not in entirety and Fed takes decision that also brings calm in the market.