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US Election Series: Expect S&P 500 to lose quarter of its value with no clear victor

Republican Presidential nominee Donald Trump hasn’t given up his constitutional rights to take legal steps if he believes that there are considerable doubts over the election outcome. There has been a media frenzy over comments in these lines after Mr. Trump at the third debate, indicated that he would keep all in suspense over what he might do after the election. He later mocked the critics at a rally by saying that he would accept the outcome, only if he wins.

While such comments would have killed any politician we know of, a stadium packed with more than 27,000 people continue to cheer and roar, when he says that the election system is rigged. Even Mr. Trump’s worst critic would admit that the followers of Mr. Trump are very passionate and enthusiastic. So if the outcome of the election is too close, there could be some serious confrontation. If Mr. Trump chooses not to accept the outcome and moves to litigation like Democratic nominee Al Gore did in 2000, where he won the popular vote but lost by 5 electoral votes, there could be serious chaos throughout the United States.

Financial markets are likely to get dragged down too by the sheer uncertainty. The equity market tanked by 17 percent back in 2000 when Mr. gore challenged the outcome and it would certainly tank by almost a quarter if the result is too close and Mr. Trump challenges the outcome.

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