U.S. stocks rose for a second straight day on Tuesday as American investors went to the polls.
Bill Lee, head of Citigroup economics, joined the FOX Business Network’s Liz Claman to discuss what investors should expect post-election.
“We’ve been warning everybody don’t be overconfident because financial market guys tend to think they are smarter than the average guy, they always want to get ahead of everybody else,” he said.
Stocks snapped a 9-day losing streak on Monday, the worst string since 1980, after FBI Director James Comey announced on Sunday that Hillary Clinton would not face criminal charges over her handling of classified information following a re-opening of the investigation into emails connected to her personal home server.
“What you’ve seen the last few days is growing confidence in that Hillary outcome. We’ve been warning it could well be that the Brexit black swan could take place or at least more uncertainty. If that were the case no one’s prepared for it,” he said.
He added, “We could have an equity market selloff. We could have corporate spreads widening and we could have rates going much higher than they are.”
However, in Lee’s opinion, no matter who wins, the Federal Reserve ultimately controls the markets.
“The Fed right now is determined to raise rates in December. In fact, if they don’t raise rates in December, I would start battening down the hatches and start digging some trenches because that means something has happened to the economy… uncertainty is the one villain that hits both sides,” he said.