Investors should be worried more about whether the hawks will take over the Federal Reserve, because of the impact that voting at the Fed's Open Market Committee will have on stocks and bonds.
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If the Fed hikes short-term interest rates quickly, that could blunt stock returns and hurt short-term bonds, while inaction on rates could hurt long-term bond investors, as inflation expectations ratchet up. Oxriver Capital's analysis of the Fed's voting coalitions indicate that interest rates should hit 1.125% by the end of 2015.
The Fed's biggest dove and hawk, respectively, Narayana Kocherlakota of the Minneapolis Fed (top) and Charles Plosser of the Philadelphia Fed (bottom), don't vote on interest rates in 2015. The pictures are from the Federal Reserve.
When it comes to economic policy, Congress has long ceded its role to the Federal Reserve. The Fed votes and acts on important economic policy matters every six weeks.
The "parties" that matter on the Fed are not Republicans and Democrats, but rather hawks and doves. The Fed hawks favor higher interest rates because they want to stop inflation from getting too high. The doves are less worried about inflation they want lower interest rates to stimulate the economy and job creation.