Risk Factors Affecting Markets Leading Up To Nov 3rd Elections

  1. China Blacklists
    China is threatening to blacklist US companies in retaliation for Huawei, Tiktok and Wechat bans. For now, China seems to be waiting till the next President is confirmed. Chinese consumer and manufacturing base is still key for some Big Tech U.S. companies. And Big Tech makes up a sizable portion of U.S. market capitalization.
  2. Trump forcing his supreme court pick, and Democrats withholding stimulus
    If Trump were to install a conservative judge before elections, we believe Democrats will ratchet up the fiscal bill saga. This is bad for markets that are already banking on incessant money printing.
  3. SPAC drying up liquidity
    SPAC (Investopedia Definition: A special purpose acquisition company (SPAC) is a company with no commercial operations that is formed strictly to raise capital through an initial public offering (IPO) for the purpose of acquiring an existing company. Also known as “blank check companies”.) ala IPO 2.0, the peak of the previous tech bubble coincided with flurries of IPO which significantly increased the supply of shares .The SPAC offerings are important to track as the money has to come from somewhere.
  4. Big tech antitrust
    Breaking up big tech is one of the key risks facing the industry. If foreign companies restrict access due to de-globalization and protectionist measures, Tech revenue will have a material impact. EU is threatening more action on this front.
  5. Trump refusing to leave office risk
    A possible black swan event that is possible given the contentiousness of the race and a possibility that counting of mail-in votes may delay the result on Nov 3.

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