Sen. Barack Obama (D-Ill.) won a decisive and historic victory, becoming the first African-American to win the U.S. presidency.
The Illinois senator, who just four years ago was a state senator in the Land of Lincoln, became the first Democratic candidate since Jimmy Carter in 1976 to win an outright majority of votes cast, winning such traditionally Republican states as Indiana and Virginia, both of which had last given their electoral votes to a Democrat in 1964.
Obama was buoyed in no small part by the ongoing financial crisis, which he successful pinned on the policies of the incumbent Republican president, George W. Bush, and his supporters in Congress, including Obama’s rival for the presidency, Sen. John McCain (R-Ariz.).
Obama, who enjoyed the substantial financial backing of the hedge fund industry and many of its top players, has taken a bellicose tone with the industry on the campaign trail. Notably, he derisively riffed on McCain as the candidate of “Joe the Hedge Fund Manager.” McCain staked much of his late campaign on trying to win over the “Joe the Plumbers” of the electorate.
Obama’s four years in the Senate haven’t produced a voluminous body of legislative work that might point in the direction that his policies might take. But there are some clues to how he will tackle the economic crisis in general, and the question of hedge fund regulation in particular.
Among the bills Obama sponsored during his time in the Senate was one that would have required hedge fund managers to set up anti-money laundering programs supervised by the Treasury Department. Just last week, the Treasury abandoned a similar proposal, but one of the Obama bill’s co-sponsors promises that the president-elect will take up the issue once he is in the White House.
“The absence of anti-money laundering controls on hedge funds is another regulatory gap that the Congress will have to tackle after the election,” Sen. Carl Levin (D-Mich.) said.
Obama has also supported tax plans that would close loopholes that favor hedge fund and private equity fund managers, greatly increasing the tax burden on those groups.
The markets, for their part, seem to be reacting favorably to the prospect of an Obama presidency. U.S. stocks rose sharply on Tuesday, as Americans went to the polls, with an Obama victory looming. Douglas Kass, founder of hedge fund Seabreeze Partners Management, called it an “Obama bounce,” but warned it was “not an Obama rally.”
Meanwhile, Asian markets closed higher following news that Obama had won. Japan’s Nikkei 225 Index rose 4.4%, Hong Kong’s Hang Seng Index rose 5.7% and Singapore’s benchmark index rose 4.1%.