Does Politics Affect the Market Directly?

I swore I was not going to talk anymore politics because I am so sick of the past 21 months of this campaigning madness, however, I had to give this topic a little bit of attention.

My younger brother is a freshman in college and sent me a text message this morning that read “Market down again becuz of obamas election?” My initial reaction to him was that to get rid of that correlation between politics and market trends because they are two separate entities in this country. I checked out the cover of Yahoo! Finance to see the headlines and it read Dow Tumbles 400 Points as Economic Woes Mount.

Does the fact that Obama won the presidency effect the value of General Electric or Apple? If McCain would have won a few days earlier would the market reacted different? Maybe slightly, but a change in the election still would not erase the fact that these economic woes still do exist. The Dow Jones Industrial Average is going to be plummeting down and sky rocketing back up in a cycle for a good amount of time till more stability is brought to our financial markets.

How much of a role, if any, do you think politics have played in these market trends?

It can definitely be stated that the lack of government oversight over the financial markets the last few years played a huge role in the current financial crisis we are currently in, but we can not classify that as a constant role in market trends. What do you think? I may not understand our system enough to give an appropriate answer but this is my answer off the surface. Help me out and explain to the young man! Be easy.