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The market has mostly seen a bullish ascent since election day last week, but CNBC’s ‘Mad Money’ host Jim Cramer believes stock investors are too complacent about a number of lingering risks that could arise and cause a potential sale.
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“We are worried that we may be headed for a constitutional crisis.”
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Among those concerns is what Cramer describes as a potential ‘constitutional crisis’, due to President Donald Trump’s reluctance to admit defeat and pave the way for a smooth transition for the former vice president. Joe Biden, who is considered the winner of the 2020 race for the White House.
“We are worried that we may be heading for a constitutional crisis,” the CNBC host said Wednesday.
“It’s not encouraging,” Cramer said, when “the president regularly tweets how the election was rigged.”
Late Wednesday, Trump, who has vowed to launch a series of challenges to the counting process, tweeted his belief that he would always win in the presidential contest that was called in Biden’s favor this weekend by most major news organizations and political experts. . The 45th President wrote “with 72 million votes, we received more votes than any sitting president in US history – and we will win!”
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“From a stock market perspective, this is a problem.”
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“It does not appear that he will be leaving the premises in January,” Cramer said Wednesday.
“By denying the legitimacy of the elections and trying to fight them in any way possible, they are certainly destabilizing the situation,” he said. “From a stock market perspective, this is a problem.”
However, it is not clear how much Trump’s reluctance to concede the election and pave the way for a peaceful transition of power will impact the market.
Shares have mostly risen since Election Day as they believed the U.S. election would result in a divided government, with Biden in the Oval Office and Democrats failing to muster a majority in the Senate – a political landscape historically seen as positive for equities as this will not result in changes that could be considered market disruptive.
The Wall Street Journal reported that Trump was pursuing a patchwork of legal attacks in a long-standing effort to try to prevent officials from certifying election results.
So far, experts see no reason to believe that Biden’s current popular vote lead and electoral college lead will not widen when the final votes are counted.
According to the Associated Press, Biden has 290 votes in the Electoral College, far exceeding the 270 needed to win the presidency, up from 214. The PA has yet to determine the winner in Alaska, Georgia and North Carolina, with Biden in the lead. Georgia and Trump lead in Alaska and North Carolina.
Meanwhile, Cramer also noted the resurgence of COVID-19, including an increase in hospitalizations across much of the United States and elsewhere around the world, and the lack of a new relief program for businesses in difficulty, other headwinds that investors are not paying attention to. at for the moment.
On Wednesday, the Dow Jones Industrial Average DJIA,
broke a two-day winning streak, but the S&P 500 SPX Index,
and the Nasdaq Composite Index COMP,
ended the day firmly higher.
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