I have been repeatedly asked in recent months “What Difference Does an Election Make”? I strongly believe that this significant watershed mid-term election could provide the ignition the market needs to get back to the 12,000 level. Here are a few bullet points which help to illustrate my thoughts:

· Over the last 60 plus years the market has never declined in the 2 quarters following mid-term elections, with the average market gain being over 18% – that makes Dow 12,500 possible next year.

· A generational event has taken place! Deficits and debt have outraged the public and they demand CHANGE! This deeply concerned public has roared. Washington will see new faces and new ideas. We will find our way back to fiscal responsibility. We need a new tax structure which is fair, easy & predictable. Maybe it is time for a flat tax and VAT. Spending must be brought down. The private sector is able to pick up the slack as the federal monster is shrunk.

· The American people will not tolerate economic failure: They want free enterprise, lower taxes and less government involvement. When new leaders convince the public that a new course is being set that will be the basis for a new mindset. We will return to normalcy. That brings reflation, then inflation.

· Money will start to flow to risk categories and the unemployment rate will start to fall. Many will be stunned at the speed at which the US Economy can turn on a dime. During this process expect volatility to increase in all asset categories. The hiding places people used will become dangerous spaces; the trillion dollars invested at rates under 3% will come running out.

Side effects:
-Equities will be one of the best performing asset categories for the next two or three quarters.
-Managed foreign exchange strategies have the potential to offer equity like returns with little correlation to equities.
-Managed commodity trading strategies also can provide attractive returns as we reflate.
-Water, oil, grains and hogs all look much higher next year.

I hope you will not hesitate to call me to discuss your portfolio or the strategies in which you are enrolled. While I recognize that there will be many challenges ahead, I firmly believe that there are an even greater number of opportunities as well.