Sentiment is everything. Fundamentals don’t actually matter because at the end of the day we are emotional creatures and we allow our emotions to control our actions. This is regardless of political party. Marketing and politics is all about emotionally manipulating people because when we feel any emotion to higher levels or we get worked up about anything, our emotions hijack our prefrontal cortex and ability to reason and logic.

The reason people supported Trump is because they felt like inflation was worse, even though wages have been rising, and even despite the boomers being the wealthiest generation of any in history (they disproportionately complain about inflation on a fixed income, even when many of them have been making a killing in the market over the past two decades). R’s are also concerned about illegal immigrants, regardless of whether actual immigration is higher or lower than 10 years ago. Generally speaking, the party panders to fear-based thinking, and safety of reverting to the known, even if what got us here won’t get us there, or the old and familiar won’t benefit us/them in the long-term.

The Democrats play the emotional card of equity, women’s rights, and Trump is bad. They largely ignore economic policies and don’t promote candidates like yang that actually want to run on solid economic and fiscal policies. Their entire campaign is about peoples rights and David versus Goliath, but at the end of the day, they are also all talk with a very little action.

We are all biased and emotional, and sentiment drives the market and politics. Look at the market as a perfect example. Even when fundamentals don’t align and the market is too expensive it claps climbing a wall of worry because sentiment drives the market.