Well, that was... an experience. Every election in America is an emotional rollercoaster, but the 2024 election? Wow. There were more twists than a soap opera, with almost every major issue competing to be the most urgent, the most divisive, and, inevitably, the most overanalyzed. But let’s get one thing straight: trying to draw lines from the chaos of election season to your investment strategy is about as useful as predicting the weather with a dartboard. Yet, here we are again, in a nation where people think politics and investing go hand-in-hand.
You'd think we’d have learned by now, but every election cycle brings a fresh wave of investors thinking they can outsmart the market by predicting political outcomes. Here are 10 snarky lessons from the 2024 election that will (hopefully) remind you to leave politics out of your portfolio.
1. Forecasts, LOL
Ah, predictive polling—the black magic of modern democracy. Every election cycle, pollsters churn out “definitive” numbers that are about as accurate as a horoscope in a fortune cookie. The 2024 election was no exception. Polls have now blown it so many times (2016, 2018, 2020, 2022, and, surprise, 2024) that it’s safe to say they’ve entered the realm of “not even wrong.”
Let’s face it: polls are almost worse than useless. They tempt investors with a mirage of certainty. All those numbers don’t mean we’re any closer to reliable forecasting. Financially savvy folks would be better off ignoring them. After all, a poll is just an aggregation of guesses, and guess what? Groupthink in finance is as dangerous as it is in politics.
2. Narratives: Love ‘Em, But Don’t Invest In ‘Em
It was a year of razor-thin margins, and the media crafted endless “turnout election” narratives, proclaiming everything from “the year of the woman voter” to “a referendum on XYZ.” Here’s the truth: narratives are seductive, they’re entertaining, and they’re mostly garbage when it comes to making investment decisions.
As humans, we’re biologically wired to love a good story, but narratives are usually wrong, or worse, oversimplified. Betting your money on them is the financial equivalent of saying, “I read a headline; let’s put the house on it.” Just remember, markets don’t run on catchy storylines.
3. Your Filter Bubble Lies to You (Yes, Even You)
Let’s be real: the world we see isn’t the world everyone else experiences. You’re in a bubble, and so am I. From social media echo chambers to hand-picked media outlets, most of us live in a cozy cocoon of opinions we already agree with. This means that we, quite frankly, have no clue what’s happening outside our own perception bubble.
In investing, this “filter bubble” leads to selective perception, where we believe our bubble’s reality is everyone’s reality. In reality, your bubble has about as much connection to the broader market as astrology has to astronomy. Diversify your sources, or your portfolio will end up as biased as your news feed.
4. Sentiment Indicators: Useless 99% of the Time
Sentiment—ah, the mythical magic metric. It’s supposed to tell us when the market is hot, cold, or indifferent. But here’s a fun fact: it’s really only helpful about 1% of the time. The rest of the time, sentiment data is like your drunk uncle at Thanksgiving—full of bold statements, not a lot of substance.
Sentiment might be a decent early warning system in extreme cases, but in an age where everyone is performatively partisan, what people say and what they believe are further apart than ever. In other words, sentiment indicators are increasingly a bad compass for your financial ship. Tread with caution.
5. Media Coverage is Misfocused (But We Knew That Already)
Sports, the media’s true passion. You want up-close, in-your-face play-by-play? The media’s got it covered when it’s the Super Bowl. Elections? Not so much. The coverage we get treats elections as a spectator sport, focusing on the drama rather than the substance.
Here’s the problem: the financial media isn’t any better. It’s fantastic at covering the day-to-day fluctuations, but utterly lacking when it comes to long-term insights. If you’re relying on a news anchor to guide your investments, well, you’re in for the investment equivalent of Fantasy Football—high stakes, low returns.
6. Attention Misplaced: Here’s What Actually Mattered
This election, pundits were busy squabbling over debates, Trump’s legal troubles, and transgender rights. But when you strip away the noise, voters really cared about a few simple issues: inflation, the economy, abortion rights, and immigration.
If you’re investing based on election hype, remember this lesson: not all issues are created equal. Focus on the fundamentals—the economy, inflation, and policy stances that directly impact money. Everything else is just part of the endless drama machine, and your portfolio doesn’t need that kind of distraction.
7. Speculation is Rampant, And You’re Paying for It
Every network you turned to during the 2024 election season—from Fox News to CNBC—was engaged in speculative commentary disguised as “analysis.” The sad truth? This speculation isn’t news; it’s entertainment. And much like sports commentary, it’s far more style than substance.
The problem is that investors treat it as gospel, making decisions based on sheer conjecture. Investing based on media-driven speculation is like buying stocks because your Uber driver mentioned them. It’s noise, not news. Don’t let idle gossip get between you and your money.
8. Nobody Knows Anything (And They Never Will)
Remember when people were 100% sure about what the election outcome would be? Or when Wall Street “experts” forecasted the market reaction? Here’s the unvarnished truth: humans are generally terrible at predicting the future. It’s not just the markets. It’s the economy, pop culture, sports, you name it.
In investing, the only certainty is uncertainty. Nobody knows anything for sure, and acting as if they do only makes your portfolio more vulnerable to the curveballs the world constantly throws our way. Stay humble and accept that we’re all clueless in this unpredictable game.
9. Humility is in Dangerously Short Supply
If the election didn’t teach us humility, I don’t know what will. Wall Street isn’t known for being humble, but the real world constantly serves up reminders that we’re far less in control than we think. When it comes to investing, humility isn’t just a virtue; it’s a necessity.
Acknowledge the gaps in your knowledge. Admit that the markets are filled with randomness, and embrace the fact that your portfolio will sometimes zig when you expected a zag. Overconfidence leads to risky decisions, and risky decisions lead to losses. So stay humble, or the market will humble you.
10. History Repeats Itself (And We Still Don’t Learn)
Ah, history, that old teacher we never listen to. Every election is a crash course in human behavior: we get swept up in forecasts, drama, and overconfidence. By now, you’d think we’d know better, but each election, people fall for the same old traps. Spoiler alert: 2028 will be more of the same.
German philosopher Georg Hegel famously said, “The only thing we learn from history is that we learn nothing from history.” Well, he wasn’t wrong. It’s the same with investing—those who ignore history’s lessons about market cycles, human emotion, and reactionary investing are doomed to repeat them. So, stop looking to the elections for your next market move, and start paying attention to the patterns that actually matter.
In conclusion, as fun as it might be to link politics and your portfolio, it’s generally a bad idea. Elections are messy, emotional, and often more entertaining than enlightening. Next time, do yourself a favor: watch the election for the show, not for stock advice. Leave the drama on cable news, and keep your investments on solid ground.
