The Midterms' Red Ripple Delivers Uncertainty to the Markets

Text size About the authors: Larry Hatheway and Alex Friedman are the co-founders of Jackson Hole Economics, and the former chief economist and chief investment officer, respectively, of UBS. In a surprise to many observers (ourselves included), the midterm elections proved to be more closely contested than most polls and political futures markets had indicated. The political prognosticating community may have had the longest night of all and will be licking its wounds in the days to come. The much anticipated "red wave" failed to materialize. While the Republicans appear poised to emerge with a small majority of perhaps 5-10…