There are a number of ways to vote: There's the traditional ballot box, voting with your feet or voting with your money.
Take a look at all three methods. Notice how they are all related right now? All are expressions of growing dissatisfaction, especially the latter two.
The ballot-box voting of last November is behind us, with the majority of voters making their wishes known and getting what they wanted. (Will it be what they needed? We'll see later.)
Voting with one's feet is seldom employed by Midwesterners. Although we may complain about taxes and our state and local governments, we don't hitch up our wagons and leave.
That's not the case in "Ahnold's Colly-for-knee-ah," where the country's highest tax rates and draconian environmental laws have driven businesses and families into Arizona and Nevada. (Ah, the law of unintended consequences.)
Voting with our money is reflected in our daily lives. We vote for products or services when we spend our dollars on them, but that's not the focus of this column. Voting with our dollars on what we choose to own - perhaps a home, business or stocks and bonds - is of importance to almost everybody.
Because most of us acquired a house for the purpose of making it a home, rather than a short-term highly leveraged investment, we aren't involved in the subprime mortgage mess or with our house being "under water" with an estimated market value less than the mortgage balance.
However, many of us do own businesses that, if valued daily, also might be considered "under water." We see such conditions, along with other factors, causing more and more businesses to declare bankruptcy, as owners vote with their monies by getting out.
Illiquid assets
Neither homes nor businesses have the ready liquidity of stocks or bonds. And their values don't move as dramatically as stocks in personal portfolios, individual retirement accounts, 401(k)s, 403(b)s or other investments.
Unlike houses and businesses, stocks and bonds can be valued and sold easily, and that's exactly what happens when owners are unsure of their economic future.
That's where we are now. Living in an era of uncertainty has affected all those areas, but most visibly, as the media's incessant drumbeat reminds us, it affects stocks.
Fear of the unknown
There is nothing the markets have more difficulty dealing with than uncertainty. Give investors bad news or good news, and they will consider those facts and make the necessary adjustments. But uncertainty creates a cloud of the unknown, an inability to digest and act on fact.
What will the stimulus package do with its unprecedented spending? Will the proposed budget, littered with earmarks and lacking job creation initiatives, lead us out of the recession? What impact would the proposed tax law changes have on my business or portfolio?
Should I hold on to my pharmaceutical and biotech stocks in light of the possibility of health care reform? What about the banks? The industrial companies? The construction companies? Retailers? The questions go on.
Uncertainty and the cacophony of negative news have combined to cause even the most experienced investor to raise cash reserves - or maybe toss in the towel.
Money market mutual funds, holding almost $4 trillion, are reflective of uncertainty-inflicted investor worries.
From all this will come opportunities for outstanding profits that will accrue for the investor who has the patience to acquire and hold solid companies' stocks for the longer term.
The key word is patience. If you don't have it, then hold on to your cash reserves until a sustainable upward market trend appears to be established.
You will miss the first, explosive part of the market's move, but the uncertainty will be considerably lessened.
Remember, too, that, in what may sound counterintuitive, the market will improve before the economy appears to be out of the woods.
Clark Davis is a 37-year investment veteran and CEO of St. Louis Investment Advisors, a specialized money-management company. He can be reached at cdavis@slia.com.
