Can the Market Regain Its Balance?: Investors will likely face more volatility and downward drift, even after the political dust settles

While the country remains sharply divided over the election, there is one thing pretty much everyone agrees on: investing in stocks has become a perilous pursuit. The outlook for 2001 is better, considering that the Nasdaq has already had most of the steam taken out of it and price-earnings ratios have come back to earth. Still, the market will probably harken back to a more normal era when returns were in the single digits. And the fact that there is no mandate for the next president and there is a narrow split between congressional Republicans and Democrats could be a plus for the market next year. Neither side will be able to push through extreme proposals for big tax cuts or excessive spending.