Obama victory implies stable Fed, tighter regulation on Wall St

President Obama is projected by US television networks to have won key swing states, including Ohio, which pushed him past the necessary 270 electoral votes to recapture the White House, while Elizabeth Warren is the choice in the hotly contested US Senate race among voters in Oak Bluffs and Tisbury

Most analysts feel the market reaction to the win will be short lived as attention will soon shift to fiscal cliff and what progress will be made there.

Here is what various analysts have to say about the Obama win:

TOM SOWANICK, CO-PRESIDENT AND CHIEF INVESTMENT OFFICER AT OMNIVEST GROUP LLC, PRINCETON, NEW JERSEY AND AN OBAMA SUPPORTER:

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“Obama win will keep Bernanke and therefore risk asset rally. The dollar is lower tonight, evidence of continuous quantitative easing.

“We saw an Obama victory and this means stability at the Federal Reserve, focus on wealth redistribution and the Dodd-Frank bill stays put. We all know that an Obama win will mean that banks will become more regulated and a potential splitting of banking business from brokerage business–upside potential brokerage firms; no upside for banks. I also think a muni business would increase.”

BONNIE BAHA, HEAD OF GLOBAL DEVELOPED CREDIT AT DOUBLELINE CAPITAL LP, LOS ANGELES, CALIFORNIA:

“Looks like an Obama victory and that the Republicans will control the House and Democrats will control the Senate. The bond market may like this in the short-term but the stock market will balk. The next area of concern for the market is the Fiscal Cliff and unless something drastically changes that is unlikely to be pleasant.”

CHRIS TOBE, WHO ADVISES PENSION PLANS AS A PRINCIPAL AT STABLE VALUE CONSULTANTS AND IS A TRUSTEE OF THE KENTUCKY STATE PENSION FUND:

“I think the Obama win along with Elizabeth Warren will lead to more accountability and tighter regulation on Wall Street. Especially after a big shift to Romney from Wall Street, Obama I believe will be less likely to hold back on regulation this term.”

COLLEEN DENZLER, GLOBAL HEAD OF FIXED INCOME STRATEGY AT JANUS CAPITAL GROUP:

“The market has already priced in an Obama win, and we’re really judging that based on the lack of volatility over the last few days, so we don’t necessarily expect a big move either way.

“We don’t expect equities to rally expect for maybe a relief rally that at least there’s some information and companies can start to make decisions. It’s not going to be a big market mover.”

DICK KOVACEVICH, FORMER WELLS FARGO CEO AND ROMNEY SUPPORTER:

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“I think it will be more of the same. The President has basically run on (the premise) that his economic policies are correct. They just need more time. He’s going to do what he’s been doing. He will continue to increase regulation, demonize and vilify businesses and spend a lot of money and tax people and so forth. He thinks that’s good and the government creates jobs and the private sector doesn’t and so on.

“I just think we will see a continuation of the last four years and we will see a continuation of the last four year results. I think the economy will do better than the last four years in spite of the government just because our economy is resilient. But I think it will underperform what it could be if we had different policies.”

BOB GELFOND, CHIEF EXECUTIVE OF MQS ASSET MANAGEMENT, NEW YORK, NEW YORK:

“The policies haven’t been conducive to economic growth. It means we are going to have more of the same, slow growth and more regulation and this isn’t conducive for business. That’s basically it.

“In a weak economy, even though it is growing still, it is frankly nuts to be talking about raising taxes, even if it is only on a small segment. It is contrary to all Keynesian dogma to raise marginal rates now.”

According to JASON ADER, FOUNDER OF ADER INVESTMENT MANAGEMENT, NEW YORK, NEW YORK, AND A ROMNEY SUPPORTER, the real challenge for Obama is to bridge the differences with Congress and work to get in the middle, if in fact he does win.”

Reuters